France, the first country to transpose the Corporate Sustainability Reporting Directive (the Directive or CSRD) through Order No. 2023-1142 of 6 December 2023,Order No. 2023-1142 of 6 December 2023, concerning the publication and certification of sustainability information and the environmental, social, and corporate governance obligations of commercial companies (the Order). has mandated sustainability reporting applicable from 1 January 2024, for large listed companies (see our Client Alert). As of this date, France is one of the first Member States to transpose the Directive, and also one of the few Member States to require sustainability reporting based on 2024 fiscal data for listed companies, which introduces a certain imbalance in the European market.
Faced with the increasing complexity of requirements and criticisms regarding the calibration of the text, particularly the burden of data collection (with potentially over 1,000 indicators required for certain companies), French and European authorities have recently opted to postpone the deadlines. This adjournment, officially announced in early 2025 (see our Client Alert), is due to a desire to simplify obligations, aiming to better support companies in this transition.
On 10 March 2025, the Senate reviewed a bill containing various provisions for adapting to European Union law in economic, financial, environmental, energy, transport, health, and the movement of persons, known as DDADUE 5.Bill containing various provisions for adapting to European Union law in economic, financial, environmental, energy, transport, health, and the movement of persons, 17th legislature. After public discussions, the senators voted to postpone the obligation to publish a sustainability report by four years — a delay that exceeds the timeline provided by the “stop the clock” mechanism at the European level.
Re-discussed in the Joint Committee on 31 March 2025, the DDADUE 5 bill previously adopted by the Senate was amended in Article 7A to find “a balance between, on one hand, respecting European commitments and the need for corporate transparency, and on the other hand, reducing the constraints they face and the unfair competition they might be exposed to, given that not all European countries have transposed the directive”, according to Danielle Brulebois, rapporteur for the National Assembly.
Definitively voted by the National Assembly and the Senate on 2 and 3 April 2025, the bill was referred to the Constitutional Court (Conseil constitutionnel) on 8 April 2025 by the ecological and insoumis groups.
Although the Constitutional Court was not consulted regarding the article concerning the postponement of sustainability reporting, it issued a favourable opinion on 29 April 2025,Constitutional Court, Decision No. 2025-879 DC of 29 April 2025. leading to the promulgation of the law on 30 April 2025 and its publication in the Official Journal of the French Republic on 2 May 2025.Official Journal of the French Republic (JORF) No. 0103 of 2 May 2025.
The omnibus directive,Directive of the European Parliament and of the Council amending Directives 2006/43/EC, 2013/34/EU, (EU) 2022/2464, and (EU) 2024/1760 regarding certain corporate disclosure and due diligence obligations in the area of sustainable development, Brussels, 26 February 2025. presented by the European Commission on 26 February 2025, paved the way for the “stop the clock” proposal, which aims to postpone the implementation of the CSRD by two years for certain categories of companies (second and third waves), to grant them more time to comply with the new standards.
The European Parliament’s vote on 3 April 2025,European Parliament News, Sustainability and Duty of Care: Members approve the postponement of new rules, 3 April 2025. which approved this postponement by a large majority (531 votes in favor, 69 against), marks a key step in this legislative process, formally validating the proposal integrated into the omnibus directive. The Council of the EU subsequently adopted the directive on 14 April 2025, which was published in the Official Journal of the EU the following day.
On the French side, the main change validated by the Joint Committee concerns the postponement of the Directive’s entry into force. Initially considered for four years in the Senate version of the text, this postponement has been reduced to two years, thus aligning with Omnibus I and the 3 April 2025 vote in Strasbourg.
This harmonisation aims to maintain regulatory consistency at the European level, while providing additional time for the affected companies to adapt their processes for collecting and publishing ESG data.
This two-year postponement applies to companies in waves 2 and 3.
The second wave, namely, includes large listed or non-listed companies and parent companies of large groups (including third-country issuers). These are companies “that are not public interest entities exceeding the average number of 500 employees during the fiscal year” and meet at least two of the following three criteria: (i) have more than 250 employees, (ii) maintain a balance sheet total exceeding €25 million, and/or (iii) have turnover exceeding €50 million.
Companies in the second wave are expected to publish a sustainability report (individual or consolidated sustainability statement, as applicable) related to fiscal years beginning on or after 1 January 2027 (instead of 2025), and thus publish the report in 2028 instead of 2026.
The third wave includes listed SMEs, “small and non-complex institutions”, and “captive insurance and reinsurance companies” (including third-country issuers).
Companies in the third wave are expected to publish a sustainability report related to fiscal years beginning on or after 1 January 2028 (instead of 2026), resulting in the publication of the sustainability report in 2029, instead of 2027.
However, nothing changes for companies in the first wave. Companies in this wave are large companies that meet the thresholds of the Non-Financial Reporting Directive and European public interest entities and non-European companies listed on a regulated European market, with more than 500 employees and which (i) maintain a balance sheet total exceeding €25 million, and/or (ii) have turnover exceeding €50 million, and are publishing their first reports this year. Third-country companies in the fourth wave that will be required to publish their sustainability information starting in 2029 (for the 2028 fiscal year) will also not be affected.
The second draft of the omnibus directive, which is still under negotiation, proposes substantive reforms that could remove many in-scope companies from the Corporate Sustainability Due Diligence Directive and the CSRD Directive’s impact. During the negotiations of the DDADUE 5 law, the French parliamentarians noted that European discussions are far from complete. According to them, it is premature to anticipate the outcome of these discussions, and therefore, the related provisions will be included in a forthcoming DDADUE bill.
Large companies and parent companies of large groups (first wave) will be able to omit certain information outlined in Appendix C of the ESRS 1 standard during the first three fiscal years beginning on or after 1 January 2024, pursuant to Article 7 of the DDADUE 5 law, amending Article 33 of the Order.
As a reminder, Appendix C lists certain disclosure requirements of the ESRS standards and their effective dates, detailing the information that companies may omit in their reporting. The objective is to implement a gradual ramp-up without penalising companies that are in the process of adapting to the new obligations.
However, the DDADUE 5 law does not alter the requirement for annual verification of the sustainability report by a statutory auditor (CAC) or an independent third-party organisation (OTI).
Article 7 of the DDADUE 5 law also amends Article L. 232-23 of the Commercial Code by allowing subject companies to omit from the report filed with the commercial court registry certain information deemed sensitive from a competitive standpoint, provided that: