Delegated Regulation (EU) 2025/1416: New Transitional Rules for Sustainability Reporting

Management Summary: “Quick Fix” Sustainability Reporting

Core of the New Regulation

The Delegated Regulation (EU) 2025/1416 (“Quick Fix”) significantly reduces the administrative burden of the CSRD/ESRS reporting obligations. It provides companies in the “first wave” with necessary flexibility for the introduction phase.

The 3 Key Reliefs

1. Removal of the Size Limit: Even companies with more than 750 employees can now take full advantage of transitional exceptions.

2. Content Joker: Complex standards (particularly biodiversity ESRS E4 and value chain ESRS S2–S4) can be suspended for up to three years.

3. Quality before Quantity: In case of difficult data situations, qualitative descriptions are allowed instead of exact numbers (e.g., for financial effects) in the first three years.

What Remains Mandatory

• Materiality Analysis: Companies must continue to disclose if an omitted topic was classified as material.

• Schedule: The regulations are retroactively applicable for fiscal years from January 1, 2025.

The Delegated Regulation (EU) 2025/1416, often referred to as the “Quick Fix”, is a key legal act by the European Commission to adapt the Corporate Sustainability Reporting Directive (CSRD) and the European Sustainability Reporting Standards (ESRS).

Published in the Official Journal of the European Union on November 10, 2025, the Commission specifically implements relief measures for companies in the first wave (Wave 1), which are obliged to report on sustainability from the fiscal year 2024.

The purpose of the regulation is to reduce the effort for sustainability reporting and to simplify the implementation of ESRS in practice. The EU responds to the challenges faced by companies in the first wave in implementing the new reporting requirements, creating a more flexible framework for implementing CSRD and ESRS at the European level.

The introduction of the Delegated Regulation (EU) 2025/1416 should be seen in the context of the growing demands for sustainability reporting in the European Union. The European Commission has initiated a comprehensive initiative, known as the Omnibus Package, to reduce the administrative burden on companies and strengthen the coherence of the European legal framework.

The focus is on simplifying and harmonizing reporting requirements, particularly for companies in the first wave, which must implement the new requirements of the CSRD and ESRS as pioneers. The Quick Fix is a crucial step to facilitate the implementation of the new standards, reduce unnecessary bureaucracy, and specifically relieve companies in the introduction phase. This underscores the Commission’s goal of promoting the sustainable transformation of the economy without overburdening companies with excessive reporting requirements.

The regulation enters into force on the third day after its publication in the Official Journal of the European Union and applies to fiscal years starting on or after January 1, 2025 (hence for reporting years from 2025). ​

The main regulations of the Delegated Regulation (EU) 2025/1416 of the Commission are:

1. Postponement of Disclosure Requirements: The regulation amends the Delegated Regulation (EU) 2023/2772 to adjust the schedule for the gradual introduction of disclosure requirements for sustainability reporting. These adjustments particularly concern the revision and simplification of reporting requirements to facilitate the implementation of the new regulations for companies. Companies with up to 750 employees can omit certain disclosures in the first years of reporting.

2. Adjustment of Reporting Obligations: Companies with more than 750 employees can also benefit from the temporary exceptions to reduce the burden. This particularly affects the more demanding thematic standards such as ESRS E4 (Biodiversity and Ecosystems), ESRS S2 (Workforce in the Value Chain), ESRS S3 (Affected Communities) and ESRS S4 (Consumers and End Users). The transitional arrangements apply for the first three reporting years.

3. Qualitative instead of Quantitative Information: In the first three years of sustainability reporting, companies can provide qualitative information if the preparation of quantitative information is not feasible.

4. Materiality Analysis: Companies omitting certain disclosure requirements must still indicate whether the respective sustainability topics were classified as material. For each topic evaluated as material, summary information is required.

Previously

• Gradual introduction of many disclosure requirements.

• Relief often only in the first year.

• Partially restricted to companies with up to 750 employees.

• As part of the new delegated regulation, adjustments to the schedule and disclosure requirements according to ESRS 1 Annex C were made to facilitate implementation for companies.

New

• Companies according to Art. 5 Para. 2 Subpara. 1 a) and Subpara. 3 a) CSRD can omit numerous disclosure requirements in the first three years.

• This also applies to companies with more than 750 employees.

• Complex topics are particularly affected, such as:

  • Climate Risks (E1)

  • Pollution (E2)

  • Water & Marine Resources (E3)

  • Biodiversity (E4)

  • Social Issues along the Value Chain (S2–S4)

Previously

• The safeguard clause in ESRS 2 Para. 17 only applied to companies with up to 750 employees.

• Larger companies had to provide additional summary information despite transitional reliefs.

New

• The limit of 750 employees is removed.

• Companies with more than 750 employees are now also subject to the new transitional rules for sustainability reporting.

• All companies using reliefs under ESRS 1 Annex C fall under ESRS 2 Para. 17.

• Uniform application of the materiality logic:

• If a topic is material, at least summary information must be reported.

According to the Delegated Regulation (EU) 2025/1416, the following companies can omit certain information:

1. Companies with up to 750 employees:

   • These companies can omit certain disclosure requirements in the first years of preparing their sustainability statement.

   • They may provide qualitative information if the preparation of quantitative information is not feasible.

2. Companies with more than 750 employees:

   • These companies can also benefit from the temporary exceptions, particularly with demanding thematic standards such as ESRS E4, ESRS S2, ESRS S3, and ESRS S4.

3. Companies reporting for the first time for fiscal years 2025 and 2026:

   • These companies can also omit certain disclosures to gradually introduce the requirements for sustainability reporting.

   • In addition to the number of employees, revenues are also used as a criterion for reporting obligation. The statutory thresholds for revenues also determine which companies fall under the new regulations of CSRD and thus the Delegated Regulation (EU) 2025/1416.

Additionally, companies omitting information must disclose whether the respective sustainability topics were classified as material.

According to the Delegated Regulation (EU) 2025/1416, companies can temporarily omit certain disclosure requirements in their sustainability statement. The scope of omissible reporting obligations is clearly regulated and depends on company size and the scope of EU directives. Specifically, the following information can be omitted:

Note: The ability to temporarily omit disclosures depends on the scope of reporting obligations, company size, and the specific regulations of Directive (EU) 2022/2464 (CSRD). However, companies must always disclose whether omitted topics were classified as material within the materiality analysis.

The Quick Fix Regulation provides first wave companies with significant reliefs in sustainability reporting. The regulation allows for certain disclosures in the sustainability report to be temporarily suspended if they are assessed as not material. Additionally, the phase-in regulations for the ESRS are expanded, giving companies more time to fully implement the new requirements. This affects all companies in the first wave, regardless of size or industry, creating a more flexible framework for reporting. The Quick Fix Regulation thus contributes to reducing the complexity of ESRS and allows companies to gradually approach the new reporting obligations without losing sight of the principles of transparency and comparability.

A central component of the Omnibus Package is the so-called Stop-the-Clock Directive. This directive, published on April 16, 2025 in the EU Official Journal, postpones the reporting deadlines for companies, giving them more time to implement the requirements of the CSRD and ESRS. The Stop-the-Clock Directive must be transposed into national law by December 31, 2025 and relieves companies by reducing the pressure to meet extensive reporting obligations within a tight timeframe. For companies, this means a valuable breather to adapt processes, data management, and internal structures to the new requirements of sustainability reporting.

December 2025 marks a decisive milestone for the implementation of CSRD and ESRS in the European Union. By this date, Member States must have transposed the directive into national law, and first wave companies are required to present their first sustainability reports. The Quick Fix Regulation and the Stop-the-Clock Directive support companies in efficiently and legally implementing the new requirements. How the implementation of CSRD and ESRS will concretely evolve in the coming months and what impact this will have on companies and the European economy remains to be seen. It is clear that the EU is sending a strong signal for sustainable and simultaneously practical regulation of corporate reporting with these measures.

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You can read all the details about the new reliefs in the official legal text. Here is the Delegated Regulation (EU) 2025/1416 as a PDF direct link.