TLDR: Lighter sustainability-reporting rules are a strategic opening rather than a reprieve, and the companies that win will turn the freed-up compliance budget into AI-driven carbon data that compounds into competitive advantage.
What changed in three months
Between February and April 2026 the rulebook moved twice, and the obligation got smaller. Anyone who spent 2024 and 2025 bracing for mandatory sustainability reporting now faces the opposite problem: deciding what to do with the freed-up effort.
The Corporate Sustainability Reporting Directive (CSRD) was sharply narrowed. The “Omnibus I” package became law as Directive (EU) 2026/470, in force since 18 March 2026, raising the threshold to companies with more than 1,000 employees and over €450M turnover. The Corporate Sustainability Due Diligence Directive (CSDDD) was lifted higher still, to 5,000 employees and €1.5B. Roughly four out of five previously in-scope companies are now exempt from direct reporting.
A value-chain cap now shields smaller suppliers. The EU finalised the VSME (Voluntary Sustainability reporting standard for SMEs), which also acts as a statutory cap: a large in-scope company can require a supplier of 1,000 employees or fewer to provide only what the VSME defines (its Basic module is roughly 46 data points). The Delegated Act giving it legal force is expected 19 July 2026.
Switzerland is writing its own chapter. On 1 April 2026 the Federal Council opened consultation on a new Federal Act on Sustainable Corporate Governance (CSA), closing 9 July 2026, with climate-disclosure obligations targeted for 1 January 2027.
Are you still in scope? The post-Omnibus thresholds
| Rule | Now applies to | Effect |
|---|---|---|
| CSRD — sustainability reporting | More than 1,000 employees and over €450M turnover | ~80% of previously in-scope firms exempted |
| CSDDD — due diligence | More than 5,000 employees and over €1.5B turnover | Limited to the largest groups |
| VSME — value-chain cap | Suppliers with 1,000 employees or fewer | Customers can request at most ~46 data points |
| Switzerland — CSA (draft) | Consultation to 9 July 2026; effect targeted 1 Jan 2027 | Climate disclosure + transition plans |
Out of scope, still on the hook
Leaving mandatory scope keeps the data relevant; the pressure simply shifts from the regulator to the market, where it bites harder.
Your largest customers still need their numbers: a €450M+ client that remains in scope must report its value-chain (Scope 3) emissions, so it will keep asking you — capped at VSME level, but asking all the same. Banks and insurers price sustainability data into sustainability-linked loans and risk premiums. Investors and acquirers treat missing or unverifiable environmental data as a discount on your valuation. The obligation moved from the statute book to the contract, the term sheet and the procurement portal.
The innovation angle: from box-ticking to a live, verifiable asset
The reason to keep going is that the technology to do sustainability data well became radically better and cheaper in the same window the rules eased. AI-driven carbon accounting and digital MRV (Measurement, Reporting and Verification) changed the unit economics:
- AI agents match millions of activity data points to emission factors in minutes, work that once took weeks, with teams reporting up to 70% time savings.
- Digital MRV stacks combine satellite imagery, the Internet of Things (IoT), AI and blockchain into near-real-time, independently verifiable data — the difference between “we estimate our emissions at roughly X” and “here is the audited, timestamped figure.”
- A mature software market (Watershed, CO2 AI, Sweep, Normative, Greenly, Carbonfuture) puts investment-grade data within reach of mid-sized firms for the first time.
Cheap, fast, verifiable data becomes an input to decisions rather than a compliance cost: where to cut energy spend, which products to redesign, which green-financing line you now qualify for, which low-carbon claim you can defend without greenwashing risk. That is the innovation dividend — the rules eased and the tooling matured, and the gap between those two facts is where advantage now sits.
Why lighter rules tempt you to stop — and why that’s the trap
There is a behavioural reason so many firms over-prepared and now feel like easing off: losses loom larger than gains, so the threat of a fine drove more action than the prospect of advantage ever did (Kahneman & Tversky, prospect theory). Remove the threat and the instinct is to bank the relief. The disciplined move is the reverse — treat the avoided cost as budget you have already approved, and redirect it into capability while competitors relax.
What to do now — by who
If you are a large, still-in-scope company: keep your CSRD programme, but replace annual manual collection with continuous AI-assisted MRV so the same dataset serves reporting, financing and product decisions.
If you are an SME supplier: adopt the VSME Basic module as your baseline. It is the common language your big customers and your bank already speak, and it legally caps what anyone can demand of you.
If you are a finance or investor-facing lead: prioritise verifiable data, because it is what converts sustainability-linked financing, credible offsets and climate-tech theses from rhetoric into terms you can sign.
Everyone: redeploy the budget freed by lighter reporting into actual emissions reduction — efficiency, electrification, and, in Switzerland, the public support programmes that fund a large share of the cost.
Switzerland: two dates that matter
9 July 2026 closes the CSA consultation — the window to shape the rule. 1 January 2027 is the likely start of amended Swiss climate-disclosure obligations, including transition plans. The 18 months between are the cheapest, lowest-pressure time you will have to build a sustainability-data capability before a deadline forces it.
The shift, in one line
Brussels asked companies to stop producing reports for the sake of reports, and to start treating sustainability as a data-driven, investable capability. Compliance became optional for most; competitive advantage stayed mandatory.
Another future is possible — and increasingly, it’s measurable.
Where do you actually stand after Omnibus? If you are unsure whether you remain in scope, what your largest customers can require, or how to build a data backbone without a Big-Four budget, that is a 90-minute diagnostic rather than a six-month project. Talk to our team.
FAQ
Is sustainability reporting still mandatory in 2026? For most companies, no longer directly. Omnibus I (in force 18 March 2026) raised the CSRD threshold to more than 1,000 employees and over €450M turnover, exempting roughly 80% of previously in-scope firms. Switzerland’s framework is in consultation until 9 July 2026, with obligations targeted for 1 January 2027.
If I am out of scope, can customers still ask for my ESG data? Yes, but it is capped. Under the value-chain cap, an in-scope company can require a supplier of 1,000 employees or fewer to provide only what the VSME standard defines (Basic module ≈ 46 data points).
What is digital MRV and why does it matter now? Measurement, Reporting and Verification using satellite, IoT, AI and blockchain to produce near-real-time, verifiable data. AI now matches millions of data points to emission factors in minutes, cutting reporting time up to 70% and making investment-grade data affordable for mid-sized companies.
What should a Swiss company do before 2027? Adopt the VSME baseline, set up AI-assisted carbon accounting, redeploy saved budget into real reduction using Swiss support programmes, and engage with the CSA consultation before 9 July 2026.
