ESG Standards and Requirements in the EU and Ukraine: Changes and Expectations
The European Union is entering a phase of large-scale revision of corporate sustainability reporting regulations. The Omnibus I package of amendments could reduce the number of companies required to report under CSRD by 80-85%, whilst the updated ESRS 2025 standards will simplify the reporting process itself—even for those not obliged to report but who have other motivations to do so.
This creates additional uncertainty for Ukrainian businesses regarding whether and when they fall under reporting requirements. For Ukrainian business, this presents both new opportunities (access to international capital, access to EU markets) and new challenges (new forms of reporting).
The Green Transition Office has presented a comprehensive analysis of changes in European ESG regulations and their impact on Ukrainian business.
A recording of the research presentation is available via the link.
The European Commission presented the Omnibus I package as part of the EU's competitiveness and clean industrialisation programme. According to the EC's calculations, Omnibus I delivers over €6 billion in total administrative relief, of which approximately €4.4 billion represents annual cost savings for businesses from the implementation of CSRD/ESRS reporting.
The research identified three baseline scenarios for CSRD revision. The European Commission's proposal envisages raising the threshold to over 1,000 employees. The Council of the EU's position adds a net turnover criterion of over €450 million. The most radical option from the European Parliament's Legal Affairs Committee (JURI) proposes over 3,000 employees plus over €450 million net turnover.
"The procedures for amending ESG directives in the EU represent a complex, multi-layered process. Omnibus amendments form part of a broader programme that also includes the Clean Industrial Deal, Competitiveness Compass, and potentially over 40 additional EU acts," explains Andrii Kitura, Development Director at DiXi Group and Head of the Green Transition Office at the Ministry of Economy, Environment and Agriculture of Ukraine.
Analysis of political group positions in the European Parliament shows that the main EP parties are inclined to adopt the European Commission's variant as a basis, but the largest party, the EPP (188 MEPs), represented by the EC President, wants to reduce CSRD coverage more radically—with 65% supporting the Council of the EU variant with a higher financial threshold.
To help companies determine whether and when their operations fall under reporting requirements—both under current rules and those to be adopted—the Green Transition Office has developed an online self-assessment tool.
By answering approximately 3-5 questions in the online self-assessment tool, a company receives a clear answer: under which scenario it falls under the requirements, when, and what volume of reporting it will need to prepare.
The form and instructions are available at https://gto.dixigroup.org
Analysis of different stakeholder positions demonstrates significant polarisation: investors, banks, academics and environmental organisations oppose reductions in sustainability reporting coverage, whilst some business associations, and crucially political parties, support reductions.
A joint statement in support of preserving the core of CSRD was signed by over 470 participants: 132 investors (Allianz SE, Nordea AM, Union Investment), 87 companies (IKEA, ALDI SOUTH, Nokia, H&M, Nestlé) and 92 other organisations. Over 260 European business researchers published "The Copenhagen Declaration" calling for the integration of scientific evidence into the Omnibus process.
European Central Bank President Christine Lagarde warned legislators: "The proposed narrowing of CSRD coverage will result in less company-level climate data being available; this will weaken our ability to conduct detailed assessments of climate-related financial risks."
A recording with detailed analysis of positions is available via the link.
Parallel to the political debates, on 31 July 2025, EFRAG published a draft of updated ESRS 2025 reporting standards with a radical reduction in indicators: minus 57% of mandatory datapoints, minus 100% of voluntary ones, a total reduction of 68% from the 2023 version. The Green Transition Office analysed the drafts and set out detailed findings in a publication.
"EFRAG has proposed a radical reduction in the number of reporting indicators. However, the mere fact of reducing the list of potential reporting indicators does not necessarily mean a reduced burden on companies required to prepare these reports," explains Oleksii Yatsiuk, ESG Expert at the Green Transition Office at the Ministry of Economy, Environment and Agriculture of Ukraine.
"Importantly, the ESRS structure has remained unchanged: the same 2 general and 10 thematic standards. The double materiality approach (albeit with significantly simplified procedures) for determining reporting indicators is also retained, which is a distinctive feature of European standards compared to others (GRI or IFRS). However, the idea of creating sector-specific standards has been completely abandoned."
A full breakdown of the changes is available in the research.
For Ukrainian business, changes in European regulations have a direct impact. According to calculations by the Green Transition Office, under current CSRD criteria, approximately 2,966 enterprises in Ukraine are covered. Sectoral distribution: industry 30%, agribusiness 20%, energy 15%, finance 15%, transport and logistics 10%. Under the updated Omnibus criteria from the EC, the number reduces to approximately 334 enterprises.
In Ukraine, reporting criteria, requirements and standards must be synchronised with EU rules through legislative changes. This means the final parameters of who will be required to report and when in Ukraine depend on decisions regarding CSRD and ESRS in the EU itself.
"For Ukrainian business, the main conclusion is this: even if formal CSRD requirements become less stringent, market requirements will remain. Companies will still receive individual requests for ESG data—whether from European partners or from banks operating with international capital. The difference is that without standardised forms, this will cost more and take more time," concludes Andrii Kitura.
The full recording of the presentation and downloadable materials are available via the link.
The Green Transition Office is an independent advisory body under the Ministry of Economy, Environment and Agriculture of Ukraine that helps to implement reforms in the field of green transition, energy and climate policy of Ukraine. The Green Transition Office operates with the financial support of the UK Agency for International Development and is implemented by DiXi Group.
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