CSRD and EU Taxonomy

On February 24, 2026, the European Council gave its final approval to the Omnibus I package, simplifying sustainability reporting and due diligence requirements for companies. For non-EU companies with operations in the EU, the revised thresholds change not just whether you’re in scope – but how you report, and under which standards. 

The changes substantially narrow the scope of the Corporate Sustainability Reporting Directive (CSRD). Under the revised thresholds, only EU companies with more than 1,000 employees and annual net turnover exceeding €450 million fall within the CSRD’s reporting requirements. 

The update also revises the rules for third-country (non-EU) companies operating in the EU. Going forward, the requirements will apply only where the group generates more than €450 million in net turnover within the EU and has an EU subsidiary or branch that generates more than €200 million in turnover. 

How the new thresholds affect non-EU Companies’ CSRD reporting 

Under the previous thresholds, many non-EU companies that were in scope for CSRD also had a large EU subsidiary in scope. With the higher thresholds now in place, it will become more common for a non-EU company to fall within scope solely as a non-EU entity, without any individual EU subsidiaries in scope. 

This distinction matters because it opens up different reporting pathways: 

When a non-EU company is in scope only at the group level 

Where a non-EU company is in scope of CSRD solely as a non-EU group (without a large EU subsidiary), it can report according to the Non-EU Sustainability Reporting Standards (NESRS), specifically developed for non-EU companies. 

While mirroring the ESRS, these standards will be lighter than the European Sustainability Reporting Standards (ESRS). In their draft form, they do not require EU Taxonomy reporting and only require an impact materiality assessment (rather than a full double materiality assessment). 

The NESRS are still under development and are expected to be finalised in 2027. 

When both the non-EU parent and EU subsidiaries are in scope 

In cases where a non-EU company meets the new thresholds and also has large EU subsidiaries in scope, companies have a strategic choice to make.  

Each in-scope EU subsidiary may choose to prepare its own standalone CSRD report. Alternatively, the non-EU company may voluntarily apply ESRS at a consolidated level, allowing the in-scope EU subsidiaries to benefit from a subsidiary exemption. This approach may be particularly relevant where multiple EU subsidiaries are individually within the scope of the EU Taxonomy. 

The revised ESRS standards are still in draft form and are expected to be finalised by mid-2026. 

Impact on EU taxonomy reporting 

The revised thresholds also affect EU Taxonomy reporting. Under the new rules, EU entities with more than 1,000 employees and over €450 million net annual turnover fall within the scope of EU Taxonomy.  

Non-EU groups, however, are not required to prepare Taxonomy disclosures – according to Commission guidance and the EU Taxonomy Regulation, non-EU companies reporting under Article 40a of the Accounting Directive do not need to include Taxonomy disclosures in their sustainability reports. 

However, where a non-EU company has EU subsidiaries that exceed the headcount and turnover thresholds for large EU entities: 

• Those subsidiaries must comply with Taxonomy reporting in their individual management reports, or 
• The subsidiaries’ Taxonomy disclosures must be included in the consolidated report if a subsidiary exemption is applied. 

CSRD reporting pathways for non-EU companies 

How to prepare: 3 key considerations on how this affects your CSRD reporting 

With the new thresholds approved, non-EU companies should carefully plan their CSRD reporting approach. The right approach will depend heavily on your corporate structure, specifically, whether any of your EU subsidiaries exceed the revised thresholds individually. Organizations who must report should consider: 

1. Assess reporting options: Consider whether your organisation could benefit from a subsidiary exemption, and evaluate which reporting standards, NESRS or ESRS, are relevant given your structure. 
2. Evaluate EU Taxonomy applicability: Determine if and to what extent your EU subsidiaries fall within the scope of EU Taxonomy. EU undertakings that exceed the 1,000 employee and €450 million turnover thresholds are required to prepare Taxonomy disclosures. 
3. Align your processes with the chosen reporting standards: If reporting according to NESRS, ensure your processes align with the standards. This will affect the materiality assessment and gap assessment content. 

If relying on the subsidiary exemption and voluntarily reporting according to ESRS at the consolidated level, make sure the Taxonomy disclosures of in-scope EU subsidiaries are incorporated. 

How Anthesis can support your CSRD compliance 

Anthesis helps companies navigate the new CSRD and EU Taxonomy requirements, including: 

• End-to-end EU Taxonomy assessments – from scoping to final disclosures 
• Materiality assessments – ensuring your sustainability impacts and risks are accurately identified and prioritised according to the revised ESRS or NESRS 
• Gap assessments – identifying gaps in current reporting and helping you prepare for NESRS or ESRS compliance as applicable 
• CSRD Reporting support and preparation – from structure and content creation to narrative development, copywriting and report design and execution