Omnibus Package: A Turning Point for ESG Strategy and Risk Governance
As the CSRD has progressively come into force across Europe from 2024, large enterprises have been gearing up to embed a more rigorous and standardised approach to non-financial reporting. Against this backdrop, the changes introduced by the Omnibus Package mark a notable shift.
Designed to address business concerns over the complexity of the ESRS (European Sustainability Reporting Standards), this simplification is intended to streamline reporting requirements without compromising the overall level of ambition.
For compliance, ethics, ESG and operations functions, one question stands out: with fewer prescriptive requirements, how can organisations maintain strong, documented and auditable control over ethical and ESG risks?
Why the CSRD Was Simplified
Since the publication of the first ESRS, many organisations across Europe have raised concerns about the significant operational burden associated with collecting, verifying and consolidating ESG data.
In response, European institutions have chosen a more pragmatic and business-aligned approach. The Omnibus Package revision is built around three core priorities:
- Reducing the level of granularity of requirements to avoid excessive documentation efforts, including for organisations that already demonstrate a certain level of ESG maturity
- Adapting implementation to organisational capacity by introducing greater flexibility and a more progressive rollout, particularly for mid-sized companies.
- Strengthening the role of materiality assessment, which becomes the primary tool for identifying information that is genuinely relevant to the organisation, its risks and its sector.
This simplification should not be misunderstood as a weakening of core requirements. European institutions have emphasised that fewer indicators do not mean lower standards when it comes to governance and risk management. In fact, as regulatory frameworks become less prescriptive, the strength of internal processes plays a critical role in ensuring compliance.
For compliance, ethics and ESG teams, this evolution reinforces expectations around:
- Early risk detection, particularly through effective internal reporting mechanisms
- Clear documentation of incidents, assessments and decisions
- Robust conduct policies, with particular attention to conflicts of interest
- Full traceability of corrective and preventive actions
In other words, simplifying reporting requirements naturally increases the importance of internal governance, which now sits at the heart of CSRD reporting credibility.
What the Omnibus Package Means in Practice for Your Organisation
The CSRD revision introduced through the Omnibus Package reshapes the structure of non-financial reporting without calling its core objectives into question. It introduces new flexibility while reducing the level of detail required for certain obligations, allowing organisations already preparing for upcoming reporting cycles to more easily adapt their approach based on ESG maturity and operational priorities.
Greater Flexibility in the Application of the ESRS
Under the Omnibus Package, materiality analysis becomes the cornerstone of disclosure decisions, guiding which information organisations are expected to report. This evolution allows organisations to align their reporting more closely with their real ESG priorities. Even within the same sector, reporting outcomes may differ, as long as they are grounded in a clear and defensible rationale.
The revision also brings practical refinements, such as implementation timelines better suited to different organisation sizes and the removal of data points deemed too complex or insufficiently actionable. Rather than diluting the CSRD’s ambitions, the goal is to encourage more relevant reporting, decision-focused and value-driven.
Why Internal Governance Is Becoming a Critical Credibility Driver
Greater flexibility in reporting does not mean lower expectations. As organisations gain more flexibility in interpreting reporting requirements, stakeholders pay closer attention to the strength of internal governance. The key question is no longer just what is reported, but whether the organisation can clearly show how it manages its ESG and ethical risks.
This evolution elevates internal mechanisms that were once viewed as support functions into decisive credibility drivers. The effectiveness of internal reporting channels, the structure of investigations, the traceability of decisions and the organisation’s ability to monitor and correct issues now provide concrete evidence of ESG maturity. Ultimately, these factors shape how credible and reliable CSRD reporting is perceived to be.
Why Calls for Transparency Emphasise Internal Discipline
A number of NGOs, institutional investors and market commentators have voiced concerns about the potential weakening of ESG transparency.
Two recurring risks are commonly highlighted:
- A loss of comparability, as increased flexibility may complicate cross-company assessments.
- Lower visibility on high-risk areas, including human rights, corruption and value chain practices.
For compliance and ESG leaders, these critiques underline a key reality. Reducing the number of indicators does not reduce expectations. It increases the need to evidence strong, reliable internal processes. In a more open regulatory environment, credibility is built through robust operational controls.
Why Simplified Reporting Elevates the Role of Internal Reporting
Weak Signals as a Strategic Risk Management Lever
Simplifying the CSRD does not mean lowering the bar for risk management. As reporting requirements become less granular, organisations are increasingly assessed on the strength of their internal governance mechanisms. Detecting weak signals early is central to this shift.
Data from the Association of Certified Fraud Examiners shows that 42% of fraud cases are uncovered through reporting channels, making them the most effective source of detection.
As a result, the quality of an internal reporting system is now a decisive indicator of organisational maturity. It enables early identification of emerging risks and clearly demonstrates consistency between ESG commitments and operational behaviour.
Reliable reporting can only exist if an organisation is able to:
- Detect non-compliant behaviour and incidents at an early stage
- Assess and document issues consistently
- Evidence decision-making and follow-up actions
- Foster a culture where concerns can be raised freely and without fear of repercussions
Without these foundations, organisations face blind spots that CSRD reporting alone, however streamlined, is not designed to capture.
How Internal Reporting Connects Ethical Risks and the Code of Conduct
A large proportion of CSRD-related risks depend on the effectiveness of internal compliance frameworks. Conflicts of interest, misconduct, corruption risks, harassment, discrimination and environmental risks across the value chain all fall into this category.
These risks are rarely captured through standard metrics. They are typically identified through human signals, raised by employees via internal reporting channels.
Within this framework, the code of conduct plays a central role. It acts as the benchmark against which situations are assessed and determines whether a concern qualifies as an ESG incident.
The code of conduct serves a dual purpose. It sets clear expectations for employees, while providing compliance and ethics teams with a reliable reference to assess, categorise and document risks.
A strong internal reporting system cannot function on its own Its effectiveness relies on a clear, actively enforced and regularly reviewed code of conduct . Together, they form a core component of credible CSRD compliance.
How Whistleblowing Platforms Demonstrate Responsible Governance
Within a more flexible CSRD environment, whistleblowing platforms take on a strategic role in governance. They provide a structured way to collect information, ensure end-to-end traceability, and deliver consistent case handling across the organisation.
A solution such as Whispli plays a critical role in enabling organisations to:
- Encourage the reporting of incidents, including highly sensitive matters
- Centralise evidence and relevant information in a structured manner
- Document decisions, investigation steps and corrective actions
- Demonstrate effective risk control during ESG audits
As a result, the effectiveness of the whistleblowing framework becomes a clear indicator of non-financial risk maturity. It plays a direct role in shaping how credible and reliable CSRD reporting is perceived, even with a reduced set of indicators.
Learn more ➡️ Empower Your CSRD Compliance with an Effective Whistleblowing Program
How Organisations Can Prepare for This New Framework
CSRD simplification reshapes the way organisations approach governance. Readiness is no longer driven by expanding indicator sets, but by structuring robust processes that underpin credible reporting. Several key levers make this possible:
1. Strengthen Materiality Analysis Over Time
As materiality becomes the cornerstone of CSRD reporting, organisations need to turn it into an ongoing governance process. This means regularly updating non-financial risk maps, involving the right internal stakeholders, and clearly documenting why certain topics are prioritised or excluded.
Because materiality directly underpins reporting credibility, this process must be transparent, well supported and consistently applied over time.
2. Embed Internal Reporting Within Risk Management Frameworks
Internal reporting should be seen as a strategic input to risk governance, not a separate compliance process. This means providing easy access to reporting channels, defining clear investigation frameworks, and developing the ability to analyse reports and identify meaningful patterns.
Beyond incident resolution, the real value lies in using these insights to inform materiality choices, refine internal policies and reinforce preventive measures.
3. Make Evidence and Traceability a Governance Priority
In a more flexible regulatory environment, credibility is built through proof. Organisations are expected to show how risks are identified, how decisions are made and how corrective actions are implemented and tracked.
Being able to trace an incident from initial signal to resolution, document the underlying analysis and explain the actions taken is now essential. To achieve this, organisations must rely on a solid documentation backbone, covering internal investigations, ESG decisions and policy enforcement.
4. Build on Tools That Enable a Consolidated Risk View
Credible reporting depends on having a clear and ongoing view of alerts, incidents, remediation actions and emerging risks. Purpose-built solutions like Whispli help achieve this by centralising data and maintaining a consistent, traceable record across the organisation.
The challenge is not compliance automation, but ensuring leadership teams can rely on accurate, structured information to evidence risk management, even as reporting requirements become lighter.
Conclusion
The Omnibus Package does not lower the level of CSRD ambition. Instead, it refocuses scrutiny on the effectiveness of internal governance, namely how organisations identify risks, document incidents and demonstrate alignment between commitments and operational reality.
As a result, whistleblowing mechanisms, internal investigations and traceability are becoming decisive factors in the credibility of ESG reporting. Platforms like Whispli support this shift by structuring reporting workflows, investigations and evidence management, providing the foundations required for audit-ready ESG disclosures.
Organisations that invest early in these capabilities will gain a clear advantage in responding to regulatory scrutiny and reinforcing stakeholder confidence.
