CSRD implementation in Germany: orientation in uncertain times
The lack of CSRD implementation in Germany is causing uncertainty among companies. This guide shows you what you can do now.
- Germany has not yet adopted its national CSRD transposition law; entry into force is expected during 2026.
- The Omnibus package (in force since 18 March 2026) raised reporting thresholds to more than 1,000 employees AND more than €450m net turnover. Both criteria must be met.
- Companies outside the new scope can still benefit from preparing voluntarily using the VSME (which is becoming the broader "VS, Voluntary Standard").
- No-regret moves (materiality analysis, data management, internal responsibilities) remain worthwhile regardless of how the law develops.
- Early action creates competitive advantages: better access to funding, stronger investor appeal, and a clearer picture of sustainability risks.
The Corporate Sustainability Reporting Directive (CSRD) requires companies across Europe to publish an annual sustainability report alongside their financial report. While many EU countries (including France, Italy and Austria) transposed the directive into national law by the original deadline, Germany is still lagging behind.
This delay is causing uncertainty for companies. The German government's pushback towards the EU on requirements such as double materiality and the ESRS has further complicated the situation. Many companies are asking: what rules will really apply, and how do I prepare?
This article gives you guidance and shows how you can best prepare for the CSRD and its implementation in Germany.
The Omnibus package entered into force on 18 March 2026. Reporting is now mandatory only for companies with more than 1,000 employees AND more than €450m net turnover (both criteria cumulatively). Germany's national CSRD transposition law is not yet adopted; a public hearing took place on 10 April 2026, and entry into force is expected during 2026. For reporting year 2025 there is no obligation to apply the new ESRS unless the law enters into force retroactively.
What is the CSRD and why is it important?
The CSRD is an EU-wide directive that transforms sustainability reporting for companies. It replaces the previous Non-Financial Reporting Directive (NFRD) and introduces more comprehensive and detailed requirements.
The central objectives of the CSRD
- Uniform reporting standards: With the Sustainability Reporting Standards (ESRS), the CSRD creates a clear framework for environmental, social and governance (ESG) issues.
- Double materiality: Companies must identify and disclose both the impact of their actions on the environment and society, and the financial impact of sustainability-related risks, as part of a double materiality analysis.
- Transparency for investors and stakeholders: The CSRD ensures that investors, customers, suppliers and other stakeholders receive relevant information to make sustainable decisions.
Timeline of CSRD implementation in Germany
The implementation of CSRD in Germany has been shaped by delays and uncertainties. Although the EU issued clear guidelines, Germany has not yet fully implemented them into national law. Here are the key events in chronological order.
Up to July 2024
1. Adoption of the CSRD at EU level (November 2022)
The EU officially adopted the CSRD to comprehensively standardise sustainability reporting for companies. The directive came into force on 5 January 2023, and member states were required to transpose it into national law by 6 July 2024.
2. German draft bill on CSRD implementation (March 2024)
A draft bill for the German CSRD Implementation Act was published in March 2024 but not officially enacted. It indicated Germany intended to adopt the EU requirements 1:1, without specific adjustments or simplifications. Business associations criticised this approach strongly.
3. Delay in implementation (July 2024)
Germany missed the legal transposition deadline of 6 July 2024. This increased uncertainty for companies expecting to comply with the new requirements from the 2025 reporting year.
4. Government draft on CSRD implementation (July 2024)
On 24 July 2024, the Federal Ministry of Justice published a government draft. It provided for near-complete transposition of CSRD requirements into German law, including the ESRS, with only minor national adjustments.
From July 2024 onwards
5. EU publishes updated German translation of the CSRD (August 2024)
In August 2024, a corrigendum to the German version of the CSRD was published in the EU Official Journal. It clarified linguistic inaccuracies in the original translation, particularly around double materiality and reporting obligations.
6. EU announces Omnibus initiative (November 2024)
In November 2024, the European Commission announced an Omnibus proposal to consolidate the CSRD, the CSDDD and the EU taxonomy, with the goal of simplifying reporting and reducing bureaucratic burden.
7. German government pushback towards the EU (December 2024)
The German government lobbied the Commission to simplify CSRD requirements, calling for:
- A reduction in ESRS data points
- Measures to counter the "trickle-down" effect along the supply chain to relieve SMEs
- A postponement of reporting obligations by two years
8. Omnibus package enters into force (March 2026)
The new rules took effect on 18 March 2026. The reporting threshold now requires more than 1,000 employees AND more than €450m net turnover (both criteria cumulatively). Germany's national transposition law is still pending, with a public hearing held on 10 April 2026.
9. Draft revised ESRS published for consultation (May 2026)
On 6 May 2026 the Commission published a draft of simplified ("revised") ESRS for public consultation (feedback period until 3 June 2026). Key changes: mandatory data points cut by over 60%, total data points by over 70%, and reporting costs per company down by over 30%. The materiality assessment is also simplified.
What should German companies do now?
The non-implementation of EU directives typically creates legal uncertainty and additional expense for companies. Early action and alignment with EU requirements are therefore advisable.
Despite the delayed national implementation, German companies should actively prepare for the new requirements. The ESRS have already been adopted and provide a clear basis for reporting.
How you can prepare despite the delay
Companies should focus on "no-regret moves": risk-free, forward-looking measures that help overcome uncertainty and create future compliance, efficiency and competitiveness regardless of the final implementation timeline. Here is what we recommend:
1. Clarify responsibilities
Define which individuals and teams will take on key roles in sustainability reporting if you have not done so already.
2. Carry out a double materiality analysis
The double materiality analysis offers companies long-term benefits, regardless of regulatory changes. It creates the foundation for well-founded sustainability decisions and strategic action, whatever the final regulatory shape. The materiality analysis is at the heart of the CSRD, so it is hard to imagine it becoming irrelevant.
We recommend the materiality analysis Excel template or the Materiality Master software to carry out the analysis as cost-effectively and time-efficiently as possible.
3. Write a simplified test report using the VSME
EFRAG published a simplified voluntary sustainability reporting guideline known as the VSME standard. This voluntary standard is being broadened into the broader "VS (Voluntary Standard)", based on the VSME (EFRAG December 2024), with small content adjustments. It is now also relevant for non-SMEs with fewer than 1,000 employees outside the CSRD scope. The standard requires companies to publish only a manageable number of data points.
A ready-to-fill Word template for a CSRD-compatible VSME sustainability report, including a step-by-step guide with practical tips.
It is also advisable to follow CSRD news closely, listen to sustainability podcasts, follow webinars and attend CSRD training courses to stay current.
Subscribe to the free CSRD Kompass newsletter and receive the most relevant developments every two weeks by email.
Opportunities even without a completed German transposition
Preparing for the CSRD now offers real opportunities. Those who use the requirements strategically can gain a competitive advantage and benefit long-term.
- Transparency and credibility: Structured sustainability reporting builds trust with stakeholders. Companies that disclose their sustainability performance stand out and strengthen their reputation.
- Investor appeal: ESG-compliant companies are increasingly preferred, as sustainable investments are seen as future-proof.
- Customer loyalty: Consumers place more and more value on sustainable products and services. Transparent reporting can be a decisive factor.
- Efficiency through data analysis: Collecting sustainability data helps identify optimisation potential in processes, supply chains and resource use.
- Early regulatory adaptation: Companies that implement CSRD requirements now are ahead of future legal adjustments. A proactive approach minimises risks and avoids costly rework.
- Innovation: Working with sustainability issues promotes new products, business models and technologies, opening up new markets such as the circular economy or renewable energies.
- Access to funding: Many national and EU funding programmes target companies actively committed to sustainability. A credible sustainability strategy also opens doors to new partnerships and markets.
Conclusion
The delay in national implementation creates hurdles for German companies, but early action is crucial. Aligning with the ESRS now prepares you better for the requirements and secures strategic advantages.
The keys to successful implementation are:
- Early planning: Robust data management systems and a materiality analysis create a solid foundation.
- Flexibility: A well-developed sustainability strategy lets you react quickly to regulatory changes.
- Long-term perspective: Sustainability is an opportunity to increase innovative strength, efficiency and competitiveness. It is not just a legal obligation.
The CSRD is more than a guideline. It is a tool for actively shaping sustainable business practices. Companies that accept the challenges now can take a pioneering role and strengthen their future viability.
Frequently asked questions about CSRD implementation in Germany
Is Germany still obligated to transpose the CSRD into national law?
Yes. Germany's national CSRD transposition law is not yet adopted as of June 2026. Entry into force is expected during 2026, following a public hearing on 10 April 2026. Member states must transpose the CSRD by 19 March 2027 under the Omnibus rules. For reporting year 2025 there is no obligation to apply the new ESRS unless the German law enters into force retroactively.
Who still has to report under the new Omnibus thresholds?
Since 18 March 2026 the reporting obligation applies only to companies with more than 1,000 employees AND more than €450m net turnover. Both criteria must be met cumulatively. Many companies that previously expected to be in scope are now exempt.
What can companies outside the new CSRD scope do?
The VSME standard is being broadened into the "VS (Voluntary Standard)". It is a practical option for companies outside the mandatory scope. It covers only a manageable number of data points and is designed for companies with fewer than 1,000 employees outside the mandatory CSRD scope. Reporting voluntarily also prepares you for any future scope changes and meets growing demand from customers and investors.
Why is the double materiality analysis still worth doing?
The double materiality analysis is the foundation of the CSRD and offers strategic value regardless of regulatory changes. It reveals risks and opportunities early, supports better decision-making, and is central to any future reporting. Tools like the materiality analysis Excel template or Materiality Master make the process significantly more efficient.
