ESG Reporting in 2025 and 2026: Global Regulatory Changes, CSRD Delays, and What Companies Must Know | QIMA

BlogTL;DR 2025 saw major shifts in ESG and sustainability reporting worldwide. The EU introduced a two‑year CSRD delay (“Stop‑the‑Clock”), new thresholds, and simplification measures that significantly reduced the scope of companies required to report. Other jurisdictions—including the UK, Switzerland, Japan, Singapore, China, Australia, and several U.S. states—advanced or paused their own sustainability disclosure frameworks. Despite regulatory fluctuations, expectations for transparency and accountability remain high. Companies should prepare for mandatory reporting beginning 2027–2028 and align with evolving stakeholder expectations. Listen Now: Debating Key 2026 Changes in Due Diligence, Circularity, Carbon, and ESG Reporting How ESG Reporting Changed in 2025 The global ESG landscape entered a transition period in 2025. While climate-related reporting for listed companies continues to expand, reporting obligations for non‑listed companies became less certain. The most significant changes occurred in the European Union. CSRD: Key 2025 Updates The EU Corporate Sustainability Reporting Directive (CSRD) underwent major adjustments in 2025, despite already having entered into force. “Quick Fix” Delegated Act – Introduced phasein relief for Wave 1 reporters until 2026, deferring selected European Sustainability Reporting Standards (ESRS) datapoints. “StoptheClock” mechanism – Approved a twoyear delay of CSRD application. Scope reduction of ~90% – Part of the simplification package adopted by the EU. Updated CSRD Scope and Threshold EU companies and groups Non-EU parent companies Employee threshold 1000+ n.a. Turnover threshold 450 million € worldwide net turnover 1. Net EU-turnover of at least 450 million € for the last two years, and 2. Has an EU entity generating >200 million € net turnover in the previous year Timeline Reporting from financial year starting 01 January 2027 Reporting from financial year starting 01 January 2028 Additional EU Simplification Measures Member States may waive reporting in 2025–2026 for companies newly falling below the thresholds. Sector specific ESRS standards become voluntary. Listed SMEs removed from mandatory CSRD scope. Companies with USD 1bn revenue), but none advanced. Why ESG Reporting Still Matters Despite delays, exemptions, and rescoping, the number of companies publishing ESG or sustainability reports continues to increase annually. As noted in ESG Reporting.docx , companies report to: Meet legal and regulatory requirements Maintain market access Satisfy investor and financial stakeholder expectations Improve transparency and trust Communicate progress toward sustainability targets Beyond frameworks like CSRD, many regulations require specific reporting elements, including: Modern Slavery Acts EU Deforestation Regulation (EUDR) Human Rights Due Diligence laws Taxonomy Climate risk and greenhouse gas (GHG) accounting Reporting drives accountability, encourages goalsetting, and supports stakeholder engagement on material issues. What Companies Should Do Next Understand whether upcoming ESG or climate-reporting thresholds apply (2027–2028). Map cross jurisdictional requirements (EU, US states, UK, APAC). Strengthen internal data management and assurance processes. Align internal reporting with widely recognized frameworks (ESRS, ISSB, GHG Protocol). Prepare for increasing stakeholder scrutiny regardless of temporary regulatory delays. Frequently Asked Questions (FAQ) Is CSRD still happening after the 2025 delay? Yes. The CSRD has been delayed by two years via the “Stop‑the‑Clock” mechanism, but it has not been canceled. First reporting now applies for FY 2027 for EU companies and FY 2028 for non‑EU parents. Did CSRD scope shrink in 2025? Yes. The simplification package reduced the scope by about 90%, introducing new turnover and employee thresholds. Are listed SMEs still required to report? No. Listed SMEs have been removed from mandatory CSRD scope. Which countries advanced ESG rules in 2025? Japan, China, Australia, and Singapore advanced assurance or disclosure frameworks, while the UK held consultations. Which countries paused or delayed ESG measures? Switzerland paused its Climate-Disclosure Ordinance, Singapore delayed assurance deadlines, and California suspended enforcement of SB 261 for now. 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