On 26 March 2025, the EU Platform on Sustainable Finance published a key document responding to the public consultation on the new delegated act updating the EU taxonomy. It may sound technical, but it has a direct impact on how companies report on sustainability, how investors assess what is green, and how money flows towards sustainable activities in Europe.
The Platform supports simplifying reporting processes — but makes it clear: simplifying does not mean weakening.
What is the EU taxonomy and why is it being reviewed?
The taxonomy is the EU official system for defining which economic activities are considered environmentally sustainable. Its main goal is to direct private capital towards activities that align with the EU climate and environmental objectives.
In March 2025, the European Commission proposed a new delegated act to adjust and simplify the taxonomy practical implementation.
The Omnibus package: what is happening to the CSRD
At the same time, a legislative proposal known as the Omnibus package is aiming to change several EU directives, including the CSRD.
What is being proposed:
- Shrinking the scope of the CSRD by up to 80%, excluding many medium-sized companies from the obligation to report.
- Allowing large companies (over 1,000 employees) to opt in voluntarily.
3 key risks identified by the Platform
- Data fragmentation and loss of transparency — Without consistent reporting, the ecosystem becomes unreliable.
- More greenwashing, more complexity — Less data means more guesswork and more ad hoc reporting.
- Break in alignment between the CSRD and the taxonomy — The CSRD is what makes taxonomy reporting mandatory.
What the Platform recommends
- Do not reduce the CSRD scope. Keep the current coverage.
- Simplify the indicators, not the number of companies required to report.
- Promote the use of ESRS, the common European standards for sustainability reporting.
- Support SMEs with proportionate tools like the simplified SME SFS standard.
