November 25, 2025
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The Omnibus process to simplify key pieces of EU sustainability regulation – including the Corporate Sustainability Due Diligence Directive and Corporate Sustainability Reporting Directive – has now reached its critical final stage. Following the adoption of a position by the European Parliament in mid-November, the Parliament, Council and Commission are now negotiating a final deal in a trilogue process chaired by the Danish Presidency of the Council.
Shift has been actively engaged since the Omnibus process was launched in February to help ensure that the revised Directives remain as aligned as possible with the risk-based approach to sustainability due diligence. This approach is the core methodology that has underpinned responsible business conduct for over a decade, as set out in the international standards of the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.
There have been significant disappointments during the course of the Omnibus negotiations – not least the proposed substantial reductions in the scope of companies that will be covered by the CSDDD and CSRD, the loss of a predictable and harmonized standard for civil liability in EU courts and the weakening of Climate Transition Plans in the CSDDD.
At the same time, both the Council and Parliament positions contain important elements that – if secured in trilogue – would preserve the core content of a risk-based due diligence standard in the final legislation. A risk-based approach directs companies to focus on the most severe human rights and environmental risks, wherever they occur in their value chains. It starts with drawing on reasonably available information to identify the areas of greatest risk to people and planet to prioritize where they should dig deeper and focus their actions. It is what leading companies are already doing and it is consistent with other current and emerging legal requirements within and beyond the EU, including on forced labor.
The fact that these elements are there in the Council and Parliament positions despite the rushed and problematic nature of the Omnibus process is a testament to the consistent advocacy by many stakeholders, including individual companies and business associations. Companies that are already implementing the international standards have been clearly and repeatedly telling EU policy-makers that there is no benefit from a tick-box approach to due diligence focused on ‘tier 1’ business relationships; rather, it is the risk-based approach that makes due diligence both practical and impactful.
As we look ahead to the result of the trilogue – expected by early December – and final approval of the changes to the CSRD and CSDDD by Council and Parliament, it is imperative that the risk-based approach remains at the centre of EU sustainability requirements. Otherwise, the EU’s version of “simplification” will in fact require companies to create parallel due diligence systems and undermine the promise of better outcomes for workers, local communities and the environment that meaningful due diligence offers.