Fewer Companies Have to Report. The Data Still Follows You.

Author –Anchal Singh

What the EU’s Omnibus I changes mean for private equity portfolio companies and why the real deliverable was never the compliance filing

Falling outside the revised Corporate Sustainability Reporting Directive (CSRD) thresholds looks, at first glance, like a straightforward opportunity to stop. The filing is no longer required, the reporting budget can be reduced, and management attention can move elsewhere.

The regulatory relief is real. But before dismantling the process behind the report, portfolio companies and their private equity owners should ask a more useful question:

Which parts of this work will the business still need when a customer, lender, investor or potential buyer asks for evidence?

Falling outside CSRD’s scope doesn’t mean the market stops asking. It just means the request now arrives without a regulatory template attached and the company has to decide for itself what to provide, and why.

The reporting perimeter has narrowed

Under the adopted Omnibus I reforms, the CSRD’s principal scope for EU undertakings is limited to companies exceeding both 1,000 employees and €450 million in annual net turnover.

The Corporate Sustainability Due Diligence Directive (CSDDD) has narrowed even further. Its principal scope now covers EU companies exceeding 5,000 employees and €1.5 billion in worldwide net turnover, with compliance postponed until July 2029.

Because these changes are implemented through an EU directive, individual companies still need to work through national transposition, group structures and any applicable transitional arrangements before concluding where they stand.

What the revised thresholds don’t do is settle every question about what information a business needs to maintain commercial relationships or support an investment case.

Take a manufacturer with 300 employees. It sits comfortably outside the revised CSRD scope – and in the same quarter, it could still receive an emissions questionnaire from a major customer, a sustainability data request from its lender, a workforce or supply-chain question from an investor, and a due diligence request during an acquisition process. None of these four requests comes from CSRD. Each has its own legal basis, and whether the company must respond or simply should, to protect a relationship depends on that basis, not on its reporting status.

Not every data request can be passed down the value chain

Omnibus I does add real protection here: for CSRD purposes, information requested from value chain businesses with no more than 1,000 employees generally cannot exceed what’s specified in the applicable voluntary reporting standard, and contract terms designed to work around that limit are restricted too.

That protection is narrower than it sounds. It covers CSRD-driven requests specifically not information sought under separate regulatory obligations, financing agreements, procurement terms, risk management processes, or ordinary commercial negotiation. So, the manufacturer above can’t assume every incoming request is capped by the same rule; it needs to trace each one back to its actual source before deciding how to respond. A proportionate voluntary answer may still be the right call for a valuable customer or lender relationship, even where nothing compels it.

CBAM shows the same pattern from the trade side

The Carbon Border Adjustment Mechanism (CBAM) entered its definitive phase on 1 January 2026. Subject to sector-specific rules and exemptions, EU importers bringing in more than 50 tonnes a year of covered goods will need embedded emissions data from their non-EU producers.

A supplier’s exclusion from CSRD has no bearing on this. The obligation sits with the importer, and it’s triggered by the product crossing the border not by the supplier’s own reporting status. A component manufacturer that no longer reports under CSRD can still find itself fielding a CBAM driven emissions request from an EU customer, and having no framework left in place to answer it quickly.

For private equity firms, this is where the coordination problem becomes concrete: a portfolio company can legitimately wind down its CSRD driven reporting at the very moment the fund still needs consistent, comparable data from that same company to brief limited partners or respond to a co-investor.

Investor disclosures are moving too

The Sustainable Finance Disclosure Regulation (SFDR) review is still an evolving legislative process, not a settled one. The European Commission’s November 2025 proposal aims to simplify disclosures and sharpen the information investors receive but it isn’t yet a binding requirement for every general partner to document a portfolio-wide engagement strategy and shouldn’t be treated as one prematurely.

What’s already relevant, regardless of how SFDR ultimately lands, is whether a fund’s existing claims hold up. If a fund’s fundraising deck says it drove a 15% emissions reduction across its portfolio, or that it actively engages portfolio companies on transition risk, that statement needs to be traceable back to actual data from the specific companies it describes not asserted at the fund level and left unverified underneath.

That’s the real fault line: the gap between collecting data and being able to defend a claim built on it.

A number is not the same as an explanation

An emissions inventory is a measurement. It isn’t, by itself, an explanation.

A reported emissions reduction could reflect improved energy efficiency, lower production volumes, the disposal of part of the business, a changed reporting boundary, or a revised calculation methodology, and each of those tells an investor or buyer something entirely different about operating performance and future risk. The same gap shows up in materiality assessments: identifying a significant issue is only the first step. A potential buyer still needs to know what it implies for capital expenditure, customer exposure, control weaknesses, or management’s response.

The real deliverable was never the report. It’s the organisation’s ability to answer a material question with credible evidence behind it. Three things make that possible.

The evidence has to withstand scrutiny. Significant figures should trace back to source records, calculation methods, reporting boundaries and a named owner with estimates and assumptions visible rather than buried. If a number moves year over year, the business should be able to say whether that’s operational performance, an organisational change, or a methodology revision. That’s what lets a figure survive investor review, lender scrutiny and transaction due diligence intact.

The process has to be proportionate. A smaller portfolio company doesn’t need the reporting infrastructure built for a multinational. It needs a focused set of reliable indicators, matched to its actual risk profile, with clear records and defined ownership which is usually a stronger foundation for decisions than an extensive report the company can’t realistically maintain. The goal is cutting unnecessary work, not the underlying information.

The explanation must fit the decision it’s supporting. A customer, a lender and a buyer often draw on the same underlying data energy consumption but they’re not asking the same question. The customer wants a supply-chain emissions figure; the lender wants operating cost and transition exposure; the buyer wants future capex; the fund wants a portfolio-level story for its LPs. The analysis is only useful once it makes those different connections explicit, rather than handing over one number and letting each reader guess at its relevance.

Three questions for general partners, before the next fundraise or exit

Where will information requests keep coming from? Map the customer, lender, investor and regulatory demands facing each portfolio company, and record the basis for each one and who owns the response.

Which claims can the fund actually substantiate? Check that statements about sustainability performance, risk management and portfolio engagement are backed consistently across every investment they claim to cover not just the ones with the best numbers.

Could a buyer follow the evidence? Trace the sustainability claims sitting in the data room back to their source records, calculation methods, boundaries and the management actions behind them.

Omnibus I creates a real opportunity to cut unnecessary reporting work. It should also prompt a harder look at which parts of that work were actually supporting decisions, relationships and valuation all along.

Falling outside CSRD should trigger a redesign of the data process – not its removal. The value of sustainability information for a portfolio company was never really about the filing. It was always about being ready to explain performance and substantiate a claim the next time a customer, lender, investor or buyer asks.

SustainoMetric works with private equity firms to identify what remains material across their portfolios post-Omnibus, and to build data processes proportionate enough to maintain for investor reporting, portfolio engagement, and exit readiness alike.

Speak with our team about reviewing your portfolio’s post-Omnibus data requirements.

 

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