Green Finance After the EU Omnibus: What Companies Still Have to Prove in 2026

The EU cut sustainability reporting scope by roughly 80 percent in 2026. In the same year, it put ESG risk inside bank credit decisions. Here is what companies still have to prove, and to whom.

Published by MASSIVUE, an enterprise transformation and capability building firm whose Academy delivers sustainable finance, ESG risk and net zero credentials. Last reviewed: August 2026.

The short answer

Green finance did not go away in 2026. The obligation moved.

The EU's Omnibus I Directive removed most companies from mandatory sustainability reporting. But the European Banking Authority's guidelines on managing ESG risks began applying to large banks on 11 January 2026, which means your lender is now supervised on whether it assesses ESG risk in your credit file. The duty to publish a report shrank. The requirement to produce the underlying data did not, because it moved from public reporting law into private credit, investment and procurement processes that no simplification package touches.

If your company reads the Omnibus as permission to disband its sustainability data function, it will meet the same questions again at its next refinancing, with no team left to answer them.

Key takeaways

1. Two rules moved in opposite directions in the same quarter. Omnibus I entered into force on 18 March 2026 and cut reporting scope. The EBA ESG risk guidelines started applying on 11 January 2026 and expanded what banks must know about borrowers.
2. The new CSRD threshold is high. A company is in scope only if it exceeds both 1,000 employees and 450 million euros in net turnover. Newly in-scope EU companies report for financial years starting on or after 1 January 2027.
3. The value chain cap does not cover your bank. Companies below 1,000 employees can refuse data requests that go beyond the voluntary SME standard, but that protection applies to requests made for CSRD reporting purposes. Financing and risk management requests sit outside it.
4. Labelled debt still runs on the EU Taxonomy. The European Green Bond Standard has applied since 21 December 2024, and its transitional regime for external reviewers ends on 21 June 2026.
5. The market is not shrinking. Climate Bonds Initiative recorded cumulative aligned GSS+ debt of 6.8 trillion US dollars by the end of 2025, with annual aligned issuance above one trillion for a third consecutive year.
6. Outside the EU, disclosure is tightening. S&P Global counted 28 jurisdictions that had adopted ISSB standards on a voluntary or mandatory basis as of April 2026, with 12 more planning to.
7. This is now a capability question, not a compliance filing question. The companies at risk are the ones that built a reporting team, then dissolved it when the filing duty lapsed.

What the EU Omnibus actually changed

Directive (EU) 2026/470, known as Omnibus I, was published in the Official Journal on 26 February 2026 and entered into force on 18 March 2026. It amends both the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive. The consolidated text is available at data.europa.eu/eli/dir/2026/470/oj.

The headline change is scope. Both directives now use double thresholds that a company must exceed on both counts.

The reduction is large. The Commission's stated objective was to remove around 80 percent of companies from CSRD scope, and independent analyses of the final text put the surviving in-scope population at roughly 5,000 companies against an estimated 50,000 under the original directive. Accountancy Europe and Latham & Watkins both set out the final text in detail. Estimates of the exact reduction vary between roughly 80 and 90 percent depending on the counting method, which is itself a signal that nobody should plan on a precise figure.

If you want the wider reporting picture, our guide to sustainability reporting standards covers how CSRD, ISSB, GRI and the others relate to one another, and our explainer on the EU Taxonomy covers the classification system that all of this still depends on.

Why your bank still asks when the law no longer does

Six weeks before Omnibus I entered into force, a different rule started running in the opposite direction.

The European Banking Authority published its final Guidelines on the management of ESG risks on 9 January 2025. They implement Article 87a(5) of the Capital Requirements Directive, and they apply from 11 January 2026 for most institutions, and from 11 January 2027 at the latest for small and non-complex ones. They require banks to identify, measure, manage and monitor ESG risks, to embed those risks in internal processes and controls, and to maintain plans addressing the financial risks arising from the transition to climate neutrality.

The practical consequence for borrowers is direct. A bank cannot assess ESG risk in its loan book without information about the companies in that loan book. So ESG factors now enter creditworthiness assessment, and the bank has to source the underlying data from somewhere: sustainability reports, disclosures, third party ESG ratings, or a questionnaire sent to you.

This is the part that the Omnibus coverage largely missed. Most legal commentary treated the two files separately, because they are separate files. Read together, they describe a transfer rather than a repeal. Public reporting obligations contracted sharply. Private, contractual, supervised demand for the same information expanded at almost exactly the same moment.

Our earlier analysis of how banks incorporate ESG factors and of the role of ESG in banking set out the direction of travel. The EBA guidelines are the point at which it became a supervisory expectation rather than a market preference.

The value chain cap protects you from customers, not lenders

Omnibus I introduced a protection that is widely misread. Companies below the 1,000 employee threshold gained a right to refuse sustainability information requests that go beyond the voluntary standard for non-listed SMEs.

The limit on that protection matters more than the protection itself. The cap applies to information gathered for the purpose of sustainability reporting under the CSRD. It does not extend to information requirements arising from other law or from a counterparty's own risk management. The European Commission published explanatory information on the value chain cap in May 2026, and analysis of the final text by Linklaters reaches the same conclusion: the cap governs reporting requests, and leaves due diligence and risk management processes unrelated to reporting untouched.

So the position for a mid-sized company in 2026 is asymmetric in a way that is easy to get wrong:

• A large customer asking for emissions data so it can complete its CSRD report can be told to stay within the voluntary SME standard.
• A bank asking for the same data so it can assess ESG risk in its credit exposure is not making a CSRD request, and the cap does not apply.

A company that cancels its data collection work on the strength of the first bullet will discover the second at its next credit review. Where ESG information is missing or unverifiable, the realistic outcome is not refusal of credit in most cases. It is a worse risk classification, slower approval, and weaker terms, which is a cost that never appears as a compliance line item and is therefore rarely attributed to the decision that caused it.

Three other channels where the requirement survived

Labelled debt still runs on the EU Taxonomy

If you intend to raise green, social, sustainability or sustainability-linked debt, nothing in the Omnibus makes that easier. The European Green Bond Standard, Regulation (EU) 2023/2631, has applied since 21 December 2024. Using the EuGB designation requires allocating proceeds to Taxonomy-aligned activities and submitting to external review. On 21 June 2026 the transitional regime for external reviewers ends and full ESMA supervision of those reviewers begins, which tightens rather than loosens the evidence an issuer has to produce.

The market this serves is not in retreat. Climate Bonds Initiative recorded 6.8 trillion US dollars of cumulative aligned GSS+ debt by the end of 2025, with annual aligned issuance above one trillion dollars for a third consecutive year and Europe accounting for about 45 percent of 2025 volume. A shrinking reporting population and a growing labelled debt market are not in conflict. They describe the same shift: fewer companies file reports, and the ones that want the capital still have to evidence the claim.

Investors are being re-categorised, not deregulated

On 20 November 2025 the European Commission proposed a revision of the Sustainable Finance Disclosure Regulation. The proposal would replace the current Article 8 and Article 9 framework with three product categories, Sustainable, Transition and ESG basics, remove entity-level principal adverse impact reporting, and attach minimum investment thresholds and mandatory exclusions to each category.

This is a proposal, not law. Agreement is expected around the turn of 2026 into 2027, with a start-up period indicated for 2027 and 2028, and the text can still change. But the direction is clear and it is not deregulatory for portfolio companies. Categories with hard minimum thresholds and exclusions require asset managers to evidence what is in the portfolio at a granular level. A fund that has to demonstrate a minimum proportion of qualifying investments will ask its holdings for more precise data, not less.

Outside the EU, disclosure is still tightening

The EU is not the whole picture, and for companies operating across Asia Pacific it is often not the binding one. S&P Global counted 28 jurisdictions that had adopted ISSB standards on a voluntary or mandatory basis as of 22 April 2026, with a further 12 planning adoption. Rules requiring ISSB-aligned disclosure took effect at the start of 2026 in several markets.

Singapore is a useful case because the sequencing is public. Listed companies on SGX report Scope 1 and Scope 2 emissions for financial years beginning on or after 1 January 2025, with Scope 3 mandatory for Straits Times Index constituents from 2026 and voluntary for other listed issuers. ACRA has deferred ISSB-based climate disclosure for large non-listed companies to FY2030. The obligation is phased, but the direction for anyone raising capital in the region is the same as in Europe.

Who can still require your sustainability data in 2026

The useful question is no longer whether you are in scope of a reporting directive. It is which counterparties can make data a condition of something you need.

The capability mistake we are seeing this year

This section is MASSIVUE's editorial judgement, drawn from our work building capability for enterprise and financial services clients rather than from a published study.

The pattern is consistent. Between 2022 and 2024, companies expecting to fall into CSRD scope stood up a sustainability reporting effort. It was usually staffed as a compliance project: a small central team, external consultants, a data collection exercise, a target filing date. When the Omnibus removed the filing date, the project lost its justification and the team was reassigned or released.

The error is in the original framing rather than in the decision to stand down. A reporting project ends when the report is filed. A financing capability does not end, because refinancing, procurement qualification, insurance renewal and investor due diligence all recur. What those processes need is narrower than a full CSRD report but more durable than a one-off exercise:

• A defensible greenhouse gas inventory covering Scope 1 and Scope 2, with a documented method and known data quality, and a reasoned position on the Scope 3 categories that are material to you.
• Physical and transition risk exposure expressed in financial terms that a credit committee can use, not in narrative terms written for a report.
• A transition plan with capital allocation attached, because the EBA guidelines require banks to hold plans of their own and they will assess yours against theirs.
• Someone inside the company who can answer a lender's ESG questionnaire without hiring an adviser each time.

That last point is where most of the avoidable cost sits. Paying an external adviser to answer a recurring bank questionnaire is a permanent operating expense created by a temporary capability gap. Our earlier piece on the top challenges in enterprise ESG covers the internal capability problem in more depth.

What to do in 2026

Five decisions, in the order they are usually needed.

1. Confirm your actual scope position, in writing. Test against both CSRD thresholds on a consolidated basis, and check separately whether a non-EU parent or an EU subsidiary brings you in. Record the conclusion and the date, because the thresholds are new and the assessment will be asked for.
2. Ask your relationship bank what its ESG data requirement looks like now. This is the single highest value hour available in 2026. The EBA guidelines took effect in January, most institutions have revised their credit processes, and the questionnaire you will face at renewal already exists. Ask for it early rather than meeting it under time pressure.
3. Separate what you keep from what you stop. Stop building disclosure content that no longer has a filing destination. Keep the emissions inventory, the risk quantification and the transition plan, because those feed financing rather than reporting.
4. Decide where the capability lives. If sustainability data is now a financing input, it belongs close to treasury and risk rather than only in corporate affairs. This is an operating model decision and it is usually the one that gets deferred.
5. Do not use the label unless you can evidence it. With ESMA supervision of external reviewers becoming fully operational from 21 June 2026, a weakly evidenced green claim carries more downside than an unlabelled instrument.

Frequently asked questions

Does the EU Omnibus mean my company can stop collecting ESG data?

Only if you have no bank debt, no institutional investors, no labelled instruments, no large EU customers and no operations in an ISSB-adopting jurisdiction. Omnibus I removed a public reporting obligation for most companies. It did not remove the private demand for the same underlying data from lenders, investors and customers, and the EBA ESG risk guidelines that took effect on 11 January 2026 increased that demand from the banking side.

What are the CSRD thresholds after Omnibus I?

An EU undertaking is in scope only if it exceeds both 1,000 employees and 450 million euros in net annual turnover, assessed on a consolidated basis. Non-EU groups are caught where an EU subsidiary or branch generates more than 200 million euros in turnover and the group generates more than 450 million euros in the EU. Newly in-scope EU companies report for financial years starting on or after 1 January 2027, with first reports due in 2028.

Can my bank still ask for sustainability data if I am outside CSRD scope?

Yes. The value chain cap introduced by Omnibus I lets companies below 1,000 employees refuse requests that exceed the voluntary SME standard, but that cap applies to information gathered for CSRD reporting purposes. Requests made for financing and risk management purposes fall outside it, and under the EBA guidelines your bank is supervised on whether it assesses ESG risk in its credit exposures.

Is the green bond market shrinking as regulation is simplified?

No. Climate Bonds Initiative recorded cumulative aligned GSS+ debt of 6.8 trillion US dollars by the end of 2025, with annual aligned issuance exceeding one trillion dollars for a third consecutive year and Europe accounting for roughly 45 percent of 2025 volume. Requirements for using the European Green Bond designation are becoming stricter, not looser, with full ESMA supervision of external reviewers from 21 June 2026.

What is changing under SFDR, and when?

The European Commission proposed a revised SFDR on 20 November 2025 that would replace the Article 8 and Article 9 framework with three categories, Sustainable, Transition and ESG basics, each carrying minimum investment thresholds and mandatory exclusions, and would remove entity-level principal adverse impact reporting. It is a proposal rather than adopted law, with agreement expected around late 2026 or early 2027 and a start-up period indicated for 2027 and 2028.

Sources for the regulatory positions in this article are linked inline and include the European Banking Authority, the European Commission, ESMA, Climate Bonds Initiative, S&P Global, and published analysis of Directive (EU) 2026/470 by Latham & Watkins, DLA Piper and Accountancy Europe. Market and legal positions stated here reflect the position at August 2026. The SFDR revision is a legislative proposal and is identified as such.