Omnibus is not a reprieve. ESG remains a business imperative

In recent months, the topic of sustainability and related reporting obligations has remained one of the most pressing challenges for thousands of companies in Poland. This is largely due to the EU’s CSRD directive as well as the new, more demanding ESG reporting standards in the form of the ESRS.

Omnibus – Simplification, not exemption

With the announcement of the first package of simplifications on 26 February 2025 under the so-called Omnibus Directive, a number of changes were proposed to ESG reporting requirements. Among these is the two-year postponement of the CSRD reporting obligations for selected entities that were originally required to submit their first reports in 2025 and 2026. The Omnibus proposal also narrows the group of companies subject to the reporting requirement.

Many business leaders welcomed the European Commission’s proposal with a sense of relief, assuming that ESG could temporarily be pushed down the priority list. However, such thinking may prove not only short-sighted but also detrimental to the long-term interests of the company.

It is important to remember that for many entities, the obligations have not been abolished -merely postponed. The market, investors, financial institutions, and business partners are already demanding ESG-related information. ESG disclosure today goes far beyond reporting the carbon footprint of delivered packages or train travel. It includes, for instance, expert valuations of real estate or declarations made at banks -institutions which themselves must meet ESG targets and, consequently, are seeking partners who do the same.

ESG – A survival strategy, not just a reporting requirement

Many organisations still view ESG as a compliance issue to be addressed in response to emerging legislation. In reality, the essence of ESG goes far deeper. Sustainability is not just another trend imposed by Brussels; it is a logical response to changing business conditions. Climate change, social transformation, investor pressure, and rising customer expectations all require companies to rethink how they approach resilience, credibility, and competitive advantage.

Thus, ESG reporting should not be seen as a bureaucratic burden but as an opportunity to streamline internal processes, better understand risk, and prepare the organisation for the future – particularly when implementation timelines have been extended and the scope of covered entities reduced.

Double materiality analysis

Double materiality analysis serves not only as the starting point for ESRS-compliant reporting, but more importantly as a strategic and informational tool for management. It enables organisations to identify how their operations affect the local community, the environment, suppliers, and supply chains – as well as how these external factors influence the company’s finances, reputation, and strategic planning.

A comprehensive review of internal processes also brings to light disparities in pay, employee engagement, professional development, participation in training, and other areas that contribute to workforce effectiveness.

Many organisations that have undertaken this process have gained a new perspective. For some, the double materiality analysis became the catalyst for redefining strategy, reformulating business objectives, or reshaping value chains. This is what sets “authentic” ESG apart from mere marketing narrative.

Why ESG can’t be put on hold

From a regulatory standpoint, some companies may indeed benefit from a deferral of their initial reporting obligation by two years. But the real question is whether this extra time will be used to better prepare – or merely to justify inaction.

Market practice shows that delaying ESG initiatives can have real and tangible consequences. An increasing number of banks and financial institutions now require information about climate and social risks. When seeking funding, companies are expected to provide details on their carbon footprint, environmental risk management, and inclusive hiring practices. A lack of data on sustainability performance may lead to poorer risk assessments, higher capital costs, or, in extreme cases, refusal of financing.

Equally important is the fact that ESG is becoming a key selection criterion in business relationships. Large corporations demand ESG compliance from suppliers, and younger consumers in particular are more likely to support brands that take concrete action to improve their environmental impact.

ESG: action over delay

Implementing ESG is not something that can be done in a week – or even a quarter. It requires the formation of dedicated teams, staff training, deployment of data collection tools, the development of procedures, and above all, a fundamental shift in the way the business operates.

That is why every organisation with a long-term business outlook should begin preparing now. Even if the CSRD and other ESG regulations will not formally apply for a few more years, proactive efforts today will enhance a company’s resilience, strengthen its market position, and help avoid costly surprises in the future.

Strategy as the way to survive

In an environment of growing geopolitical tensions, climate crises, and economic volatility, sustainability has evolved into a survival strategy. ESG is no longer just about what a company does for the environment or local communities – it is also about whether the company understands its own risks and can respond to them effectively, with a robust and future-oriented business model.

The Omnibus Directive proposal should not be interpreted as a green light to abandon ESG efforts. Rather, it is a reminder that while regulatory requirements may change, the expectations of the market, society, and stakeholders are likely to prove even more decisive for long-term business survival.

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