The adoption of the Corporate Sustainability Due Diligence Directive, CSDDD in May 2024 represented a paradigm shift. For many years, trade unions and civil society organisations had strongly urged the introduction of binding standards to hold companies accountable for human rights violations. With the EU Corporate Sustainability Due Diligence Directive, the EU committed itself to no longer ignoring the pursuit of profit at the expense of people and the environment. However, the Omnibus I Package presented in February 2025 represents a further paradigm shift: With this package, the EU Commission is proposing significant changes to the CSDDD – with far-reaching consequences  for companies, governments and society.This was discussed during a joint event organised by AK EUROPA, the ÖGB European Office, EGB, ECCJ and FoEE, moderated by Sylvia Obregon (ECCJ).

U-turn in EU sustainability legislation

In his opening statement, Valentin Wedl (AK Vienna) pointed out that the current legislative process only serves to ‘simplify’ in name but is damaging to democracy in reality and characterised by a refusal to engage in discourse and a ‘speed kills’ strategy. Above all, he said, concessions are being made to the demands of industry and influential lobby groups, starting with the watering down of the Green Deal and then – it had to be feared – the abolition of social and labour law achievements, especially those from the last legislative period. Valentin Wedl was critical of the fact that established elements of the EU legislative process were being suspended. One example being that the Omnibus legislation would be handled directly by a subgroup of the Antici Group, not intended to engage in substantive debates, rather than, as it is customary, by the Council working groups responsible for the content. This would also greatly reduce the input of the relevant ministries and the involvement of stakeholders.

Isabelle Schömann (ETUC) recalled that horrific incidents such as the Rana Plaza collapse, where thousands of workers were killed, were the reason for introducing the EU Corporate Sustainability Due Diligence Directive. The aim was not to punish companies in any way, but to ensure fair competition. Harmonised EU-wide standards are ultimately also in the interest of companies and based on the experience gained from the OECD Guidelines and national legislation in Germany and France. Isabelle Schömann deemed the argument that SMEs would be overburdened by the CSDDD to be unjustified. On the one hand, the Corporate Sustainability Due Diligence Directive includes many exceptions, and on the other hand, the SME Test is a standard instrument in EU legislation. With regard to the Directive on corporate sustainability reporting  (CSRD), which is also covered by Omnibus I, Isabelle Schömann pointed out that, at the Commission's request, the EFRAG is currently updating the European Sustainability Reporting Standards (ESRS). The negotiations concern standards that fall short of international levels. The ECB also recently issued an opinion on the CSDDD and CSRD legislation, emphasising the importance of uniform standards and speaking out against the Commission's proposed restriction of the scope of the CSRD.

Narrative of competitiveness and legality review

Nele Meyer (ECCJ) also emphasised that the Corporate Sustainability Due Diligence Directive was the result of years of negotiations and a well-negotiated compromise. In particular, she criticised the huge steps backwards taken by removing the due diligence obligation beyond direct suppliers, as well as the withdrawal of stakeholder involvement and civil liability, and the weakening of climate commitments. Given that there are only a few years left to avert climate tipping points, it is irresponsible not to use one of the few instruments available. Instead of creating legal certainty for victims of human rights violations, concessions are being made to corporations such as Exxon. At this point in time, it is important to raise our voices against the watering down of sustainability legislation. We must continue to question the narrative that deregulation promotes competitiveness. Accordingly, many companies had also supported the CSDDD, for example within the framework of the Responsible Business Alliance.

Paul de Clerck (Friends of the Earth Europe) raised the question of whether the Omnibus I proposal on the CSDDD would pass a legal validity check. This is also questioned in two recent opinions by the Swedish law firm CIRIO and the French law firm Baldon Avocats. According to the analysis, the Commission's CSDDD proposal violates the fundamental rights of EU citizens, the obligations of EU law and the Commission's own procedural rules. Among other, it would violate the principles of proportionality, legal certainty, protection of legitimate expectations and consistency. For example, regression is only permitted under the EU Charter of Fundamental Rights if there are strong legitimate, and proportionate justifications. However, the new CSDDD proposal would represent a significant step backwards in several key areas, such as access to justice and the reduction of greenhouse gases. Another problem is that the Commission has not carried out any impact assessments or suitability tests. Furthermore, the Commission has not considered any alternatives, which would also be required under the principle of proportionality. Member States could therefore potentially bring the Omnibus Proposal before the ECJ, and civil society organisations could turn to national courts, thereby triggering preliminary ruling proceedings – something that should also be avoided in the Commission's interest. Potentially, Member States could therefore bring the Omnibus Proposal before the ECJ and civil society organisations could turn to national courts, thereby triggering preliminary ruling proceedings – avoiding this should also be in the Commission's interest.


Further information:
AK EUROPA: Rules to Protect. Criticism of the Commission's omnibus packages and alternatives to deregulation
AK EUROPA: Omnibus I
A&W Blog: Omnibus: Wie die EU-Kommission Schutzvorschriften im Eiltempo loswerden will (How the EU Commission wants to get rid of protective regulations at breakneck speed)  (German only)
ETUC: Joint European Trade Union Statement on the Omnibus Proposal: A Direct Attack on Workers’ Rights and Corporate Accountability 
ECCJ (and others): Joint Statement on OMNIBUS
AK EUROPA: Photo gallery