ESG Advisory

Regulatory Landscape

ESG regulation comes with dozens of abbreviations, directives, and standards – and keeping track of all of them is no easy task. Below, we summarise the key frameworks applicable as of June 2026, including which companies they apply to and what obligations they entail. The information should be read as a snapshot as at the date of publication, since some of the related delegated acts and national transposition measures may continue to evolve.

Omnibus I

A key milestone of 2026 is the Omnibus I legislative package, designed to simplify selected sustainability rules (in particular the CSRD, EU Taxonomy, and CSDDD) and reduce the administrative burden on companies. The package, proposed by the European Commission on 26 February 2025, consists of two pillars. The first is the "Stop the Clock" Directive (EU) 2025/794, published in the Official Journal on 16 April 2025, which postponed the phase-in of reporting obligations for CSRD waves II and III and extended the CSDDD transposition deadline. The second is the substantive Directive of the European Parliament and of the Council (EU) 2026/470, which entered into force on 18 March 2026 and amends both the obligations themselves and the scope of entities they apply to (see table below). Member States are now required to transpose the CSRD provisions by 19 March 2027 and the CSDDD provisions by 26 July 2028.

CSRD / ESRS

The Corporate Sustainability Reporting Directive 2022/2464 is a European directive that introduces mandatory non-financial reporting (the disclosure of sustainability information) and significantly expands the scope of disclosed ESG information. It applies to a broad range of companies and indirectly affects their supply chains. It replaces the previous NFRD framework in its entirety.

Entity	Financial year from	Year of report publication	Comparison with the original CSRD
Large undertakings¹ that are public-interest entities² (>500 employees)	1 January 2024	2025	No change
Companies and parent companies of a group (>1,000 employees + net turnover >€450m)	1 January 2027	2028	Postponed by 2 years + scope narrowed
Listed SMEs, small non-complex credit institutions, captive insurance companies	originally 2026	–	Obligation under the original wave repealed; recommended/voluntary reporting under VSME
Third-country companies (net turnover in the EU >€450m)	1 January 2028	2029	Changed: threshold increased from €150m to €450m of EU turnover

¹ Large undertakings are those which, as at the balance sheet date, exceed at least two of the following three thresholds: a) balance sheet total of EUR 25,000,000; b) net turnover of EUR 50,000,000; c) average number of employees of 250.
² Companies listed on a regulated market, credit and insurance institutions, and other entities designated by the state.

Reporting is carried out in accordance with the mandatory ESRS (European Sustainability Reporting Standards), which define the structure, content, and requirements for the traceability and auditability of data across the E, S, and G pillars. Third-country companies may alternatively report under standards recognised by the Commission as equivalent to the ESRS.

Directive 2026/470 requires the European Commission to adopt a substantially simplified set of ESRS within six months of its entry into force, i.e. by 18 September 2026. The Commission published the draft delegated act on 6 May 2026; the revised standards will be binding for reports covering the 2027 financial year.

The Czech Republic has, in fact, moved ahead of the new thresholds. The amendment to the Accounting Act and the Act on Auditors (Act No. 316/2025 Coll.), effective from 1 January 2026, raised the employee criterion for mandatory sustainability reporting from 500 to 1,000, applicable already to financial years starting on or after 1 January 2025. No interim category of companies between 500 and 1,000 employees therefore arises in the Czech context; the remaining Omnibus provisions must be transposed by March 2027.

Our CSRD services

• Linked to the EU Taxonomy – CSRD forms the basis for the assessment of companies by investors and banks. Grinity helps clients set up reporting so that it meets the relevant regulatory requirements and is ready for assurance.
• Practical implementation – we have systematically mapped the ESRS standards into specific data requirements. This enables us to guide clients through the entire process via workshops, set up internal processes, and prepare an auditable output.
• Legislative framework 2026 (Omnibus) – we carry out the implementation with full regard to the Omnibus package ("Stop the Clock"), which has clarified the timing of the individual phases and the scope of entities subject to the requirements for the current period.

VSME

For companies that are not directly subject to CSRD but form part of supply chains or are seeking bank financing, we offer support for implementing the VSME standard (Voluntary Sustainability Reporting Standard for SMEs).

VSME was developed by EFRAG as a proportionate alternative to CSRD for small and medium-sized enterprises. Reporting covers three core pillars – environmental aspects (energy consumption, GHG emissions, waste, water), social topics (working conditions, health and safety, supply chain), and governance (anti-corruption measures, business conduct). The standardised format ensures the data is clear and comparable – whether it is shared with a supply chain partner, a bank, or an investor.

The importance of VSME has grown substantially with the Omnibus package. Directive 2026/470 introduces a "value chain cap": companies with up to 1,000 employees cannot be required to provide business partners reporting under the CSRD with information beyond the scope of the VSME standard. The voluntary standard thus effectively becomes the ceiling on the ESG data that large customers and banks may request from you – and the European Commission is set to adopt it as a binding reference standard by delegated act by the end of 2026. A well-implemented VSME therefore gives clients a strong, market-recognised data foundation that makes communication with customers, banks, and investors easier and significantly streamlines responses to their ESG requests.

• Two reporting levels – we help clients choose the right version: the basic module for simpler reporting, or the comprehensive module for companies that need to provide more detailed data to banks, investors or customers.
• Competitive advantage – voluntary reporting in 2026 clearly signals a company's readiness to meet market expectations and makes it easier to communicate with large buyers and banks (linked to GAR/BTAR ratios).
• Implementation – we have the VSME standard systematically mapped into specific data requirements. We guide clients through the entire process – from mapping data sources and running workshops to delivering a final report ready to hand over.

SFDR 2.0

The Sustainable Finance Disclosure Regulation (2019/2088) applies to financial market participants and financial products. Its aim is to increase transparency, reduce greenwashing, and help investors compare products from a sustainability perspective.

Although SFDR primarily affects financial markets, it indirectly impacts all companies seeking capital. Banks and investors require ESG data from their clients in order to meet their own reporting obligations and classify their portfolios. The upcoming revision represents a fundamental overhaul of the framework, moving towards simpler rules, clearer product categories, and stricter conditions for using ESG claims in investor communications.

CSDDD

Directive 2024/1760 (Corporate Sustainability Due Diligence Directive) requires companies to manage and demonstrate the impacts of their activities on human rights and the environment. This responsibility extends beyond a company's own operations to cover its entire supply chain. Our team helps clients design effective due diligence processes, assess risks, and screen suppliers. We prepare complete documentation for reporting and potential audits, ensuring that the procedures put in place stand up to external scrutiny.

Entity¹	Transposition	Implementation²
EU companies with more than 5,000 employees and a net worldwide turnover exceeding €1,500,000,000	26 July 2028	26 July 2029
A company acting as the ultimate parent company of a group meeting the thresholds under the first point	26 July 2028	26 July 2029
Companies with franchise or licensing agreements in the EU – licence fees exceeding €75,000,000 and a net worldwide turnover exceeding €275,000,000, or their parent companies	26 July 2028	26 July 2029

¹ For companies established outside the EU, only the turnover criterion applies: they fall within scope where their net turnover generated in the Union exceeds €1,500,000,000; employee headcount is not assessed.
² Start of application of transposed measures (i.e. companies must fulfil due diligence obligations).

Companies falling within the scope of the CSDDD that are not covered by sustainability reporting under the CSRD will be required to publish an annual due diligence statement on their websites. This obligation is set to apply for financial years starting on or after 1 January 2030. From 1 January 2031, the published statement will also have to be submitted to the relevant collection body so that it can be made accessible via the European Single Access Point (ESAP).

The Omnibus also caps penalties at 3% of net worldwide turnover, abandons the plan for a harmonised EU civil liability regime (liability remains governed by national law), and removes the obligation to adopt a climate transition plan – although the CSRD disclosure requirement regarding any existing plan remains.

Green Claims

The rules governing environmental claims are tightening significantly in 2026. Directive (EU) 2024/825 (the Empowering Consumers Directive, "EmpCo") bans generic claims such as "eco-friendly", "green", or "climate neutral" unless they are substantiated with verifiable data, and tightens the conditions for using sustainability labels. Member States were required to transpose the directive by 27 March 2026, and the new rules will apply from 27 September 2026. In the Czech Republic, transposition is under way through an amendment to the Consumer Protection Act and the Civil Code, currently (as of June 2026) before the Chamber of Deputies.

The follow-up Green Claims Directive, which was intended to introduce detailed substantiation requirements and independent verification of claims before publication, has been put on hold – in June 2025 the European Commission announced its intention to withdraw the proposal, although it has not been formally withdrawn. The direction of travel is nevertheless clear: every green claim must be backed by data.

We help clients communicate sustainability in a way that stands up to scrutiny – substantiating environmental claims with hard data, whether that means energy consumption figures, a GHG Protocol carbon footprint, CRREM analysis results, or building certifications. This reduces exposure to greenwashing allegations and strengthens our clients' credibility with customers, banks, and investors alike.

ESG Due Diligence

Our ESG services cover the full process – from technical asset assessment to the preparation of reports that meet regulatory requirements.

ESG due diligence is an independent review of a project or property – both existing and newly built – designed to identify environmental, social, and governance risks before they affect the value of the asset. Our team analyses both existing buildings and project documentation at the design stage, delivering a practical basis that enables clients to make informed investment decisions. The output can equally serve tenants who are actively engaged in ESG and sustainability.

Environmental (E)

Within the environmental pillar, we focus on the operational efficiency and environmental impact of the building. Our goal is to optimise resource consumption and prepare clients for future regulatory requirements.

• Energy performance – we analyse energy consumption and identify potential for energy savings and technical optimisation.
• Water management – we review water consumption, sanitary fixture flow rates, and propose measures to improve water management efficiency.
• Waste and circularity – we assess waste management practices and the potential for applying circular economy principles.
• Biodiversity – we analyse blue-green infrastructure and opportunities to support local ecosystems in urbanised environments.
• EU Taxonomy alignment – we assess whether the project meets the environmental objectives (climate change mitigation and adaptation) and the DNSH (Do No Significant Harm) principle.

Social (S)

The social pillar assesses how the property contributes to user wellbeing and the broader community. We focus on health, safety, and compliance with the standards that are key to the long-term attractiveness of the space.

• Transport and mobility – we evaluate public transport accessibility, facilities for cyclists, and alternatives to private car travel.
• Health, safety and well-being – we analyse indoor environmental quality, user comfort, the level of local amenities, and the quality of outdoor relaxation areas.

Our findings help clients demonstrate social responsibility to tenants, investors, and regulators alike.

Governance (G)

We analyse the governance of a project or asset in terms of ownership and decision-making transparency, contractual arrangements with tenants, and the management of non-financial risks. We help clients build a credible governance structure that stands up to scrutiny from both investors and regulators.

• Ownership structure – we review the transparency of the ownership chain, the set-up of internal control mechanisms (code of conduct, anti-corruption measures, whistleblowing system), and non-financial risk management processes.
• Tenancy relationships – we review lease agreements from the perspective of environmental and social standards (Green Leases) and tenant selection criteria.
• Certifications and initiatives – we review obtained sustainability certifications (BREEAM, LEED, DGNB) and existing ESG reporting processes.

ESG Reporting

We help clients meet their reporting obligations – or turn them into a competitive advantage. Whether the obligation stems from CSRD, the voluntary VSME standard, or the need to demonstrate EU Taxonomy alignment, we manage the entire process from the initial consultation to the final auditable output.

Selecting the right framework

The ESG regulatory environment offers many standards and frameworks, and the right answer is different for every client. We help clients navigate the available options – whether that is CSRD/ESRS, the voluntary VSME standard, or another framework tailored to their specific needs. Together, we assess which obligations apply and recommend the most effective path forward. Where the standard has already been determined – for example by a bank or parent company – we pick up right from there.

ESG report preparation

Once the right standard has been selected, we manage the entire report preparation process – from setting up data collection and running workshops with the client's team to delivering an auditable output that meets all the requirements of the relevant standard. We have systematically mapped the ESRS and VSME standards into specific data requirements, saving time and minimising the risk of errors. The result is a report that investors, banks, and regulators can rely on.

EU Taxonomy alignment

For many clients – particularly those seeking bank financing or looking to engage institutional investors – the key objective is to demonstrate alignment with the EU Taxonomy. We assess whether the client's activities and projects meet the taxonomy criteria and prepare the documentation needed to prove it. This allows clients to communicate the sustainability of their portfolios credibly to both banks and investors.

→ Learn more about the EU Taxonomy

CRREM Analysis

CRREM (Carbon Risk Real Estate Monitor) is an internationally recognised tool for assessing climate transition risk in real estate. It compares the carbon and energy intensity of a building or portfolio against decarbonisation pathways (CRREM Pathways) aligned with the Paris Agreement targets. The key output is the CRREM Misalignment Year – the year in which an asset, on its current or planned trajectory, exceeds the values of its pathway and falls out of alignment with climate targets.

At Grinity, we use CRREM analysis to identify buildings with elevated transition risk and to assess the impact of planned efficiency measures on an asset's decarbonisation trajectory. The results give you a sound basis for investment decision-making, CAPEX planning, financing discussions, and the long-term management of portfolio decarbonisation.