- Companies exempt from reporting on non-material activities—defined as under 10% of revenue, CapEx, or OpEx.
- Reporting templates streamlined—datapoints cut by 64% for non-financial firms and 89% for financial firms.
- New measures apply from January 2026, with an option to delay until the 2026 financial year.
The European Commission has adopted a Delegated Act to streamline the EU Taxonomy framework, significantly easing the compliance load for financial and non-financial companies. The changes are part of a broader effort under the Omnibus I package to reduce administrative and reporting burdens across sustainability regulations.
“Today we take a decisive step towards a more growth-friendly, usable and proportionate sustainable finance framework,“ said Maria Luís Albuquerque, Commissioner for Financial Services and the Savings and Investments Union.
“Our measures simplify the application of the EU Taxonomy and strike the right balance between reducing excessive administrative burden for our companies, while keeping our longer-term goals in focus, including the transition to a sustainable economy.”
Key Changes in the Simplification Package:
- Materiality Thresholds Introduced:
Companies will no longer be required to assess EU Taxonomy eligibility or alignment for economic activities that are not financially material to their operations.- For non-financial companies, activities are non-material if they make up less than 10% of revenue, capital expenditure (CapEx), or operational expenditure (OpEx).
- For financial companies, the same threshold applies to financial assets financing specific economic activities, provided the use of proceeds is known.
- OpEx Reporting Relief:
Non-financial firms may now omit Taxonomy alignment assessments for total operating expenditures if these are not material to their business model. They are only required to report the total OpEx value along with a justification of non-materiality. - Simplified Reporting Templates:
- Non-financial companies: 64% reduction in required datapoints.
- Financial institutions: 89% reduction in datapoints, including simplified disclosure of the Green Asset Ratio (GAR).
- “Do No Significant Harm” Criteria Adjusted:
Rules under the pollution prevention and control objective—especially those involving chemicals—have been clarified and simplified to ease compliance while maintaining environmental integrity.
RELATED ARTICLE: European Commission to Withdraw Greenwashing Regulation
Timeline and Implementation:
The changes are formalized in a Delegated Act amending the Taxonomy Disclosures, Climate, and Environmental Delegated Acts. Following a four-month scrutiny period by the European Parliament and Council—extendable by two additional months—the updated rules will:
- Apply from 1 January 2026, covering the 2025 financial year.
- Allow companies the option to delay implementation to the 2026 financial year if preferred.
These measures aim to align Europe’s green transition with its competitiveness goals by reducing bureaucratic friction in sustainable finance disclosures, without compromising environmental ambitions.
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