Omnibus: Relaxing sustainability requirements risks harming SMEs

Clarity , consistency , and simplicity , without reducing the ambition of environmental and social objectives, are key principles for SMEs to fully participate in the ecological transition . These are the key principles advanced by the analysis of Legacoop , the National Confederation of Crafts and Small and Medium-Sized Enterprises (CNA), and ECCO , the Italian climate think tank, ahead of the European debate on the Omnibus I package for the reform of sustainable finance regulations.

According to the analysis conducted by the three organizations, exempting or reducing sustainability requirements would not guarantee the inclusion of SMEs in the transition process. On the contrary, a stable regulatory framework , accompanied by adequate business and professional development policies, would allow companies to develop the skills needed to compete in international markets.

"There is an increasingly close correlation between reporting and access to credit," explained Beatrice Moro , Senior Policy Advisor at ECCO. "If SMEs are unable to measure and communicate their environmental and social impacts, they risk being excluded from financing channels and value chains. Europe must not relax obligations, but facilitate the adoption of clear and consistent tools."

In their analysis, the three organizations highlight that a purely simplification-oriented approach risks becoming a barrier to SMEs' access to transition opportunities, considering that they account for over 50% of European GDP and 63% of corporate emissions. Key directives such as the CSRD , the CSDD , and the EU Taxonomy have introduced fundamental requirements to redirect financial flows and promote a sustainable transition. The goal now is to make them applicable to smaller companies as well.

"To enable cooperatives and SMEs to effectively implement the EU Directive on Corporate Responsibility for Sustainability, a harmonized, proportionate, and consistent regulatory framework is needed," said Simone Gamberini , President of Legacoop. "Exemptions aren't needed, but concrete tools are needed to support businesses on this journey, ensuring long-term regulatory stability for planning investments and strategies. Only in this way will it be possible to create an inclusive, competitive, and resilient economy."

According to Legacoop, CNA, and ECCO, the Omnibus Package should incorporate five recommendations to strengthen SMEs' ability to plan and finance their transition:

1. Proportionate and scalable reporting standards , based on company size;
2. Industry standards and enforcement of dual materiality , to ensure that businesses focus on truly relevant and useful information;
3. Risk-based due diligence , to avoid unnecessary bureaucratic burdens and focus efforts where most needed;
4. Implementation of robust and credible transition plans , as a strategic tool to guide investment decisions and corporate planning;
5. Concrete operational support from large companies , the financial system, and public institutions, through training, digital tools, incentives, and reward policies.

"CNA recognizes the economic and social value of the green transition," continued Dario Costantini , President of CNA. "Despite the debate on the European Green Deal, this remains one of the most relevant EU strategies for businesses. The green transition cannot occur without the involvement of micro and small businesses. It is essential to adopt a strategic and less bureaucratic approach to green policies to ensure that small businesses play a central role in this challenge."