Corporate Sustainability Reporting Regulations 2025 now in force

The Corporate Sustainability Reporting Regulations 2025 (the “2025 Regulations”) are now in force with effect from 7 July 2025.

“Stop-the-Clock” Directive now transposed and two-year pause on reporting obligations in place for “wave 2” and “wave 3” companies

The 2025 Regulations transpose the “Stop-the-Clock” Directive into Irish law and put a 2-year pause on the application of sustainability reporting obligations on “wave 2” and “wave 3” companies which include “large” companies and SMEs listed on an EU regulated market.

The wave 2 and wave 3 companies are no longer subject to the sustainability reporting requirements for financial year (FY) 2025 or FY 2026 and will report instead in 2028 (for FY 2027) and 2029 (for FY 2028) respectively.

While the “Stop-the-Clock” Directive and transposing 2025 Regulations do not amend the reporting timeframe for the largest (“wave 1”) companies ie large public interest entities reporting in 2025 (for FY 2024), a “quick-fix” Delegated Act was adopted by the European Commission on 11 July 2025 and, when finalised and brought into force, will provide some concessions and reduce the reporting burden for “wave 1” companies in 2026 (for FY 2005) and 2027 (for FY 2026). For more information, refer to our briefing here.

The postponement of the application dates in the “Stop-the-Clock” Directive and the 2025 Regulations is designed to give the European co-legislators time to agree the Commission’s substantive proposals to amend the scope of the Corporate Sustainability Reporting Directive (CSRD) to help boost EU competitiveness as part of the Commission’s sustainability omnibus package.

Inconsistencies between the CSRD and the Irish Corporate Sustainability Reporting Regulations 2024 (the “2024 Regulations”) addressed

The 2025 Regulations also helpfully address many of the inconsistencies identified between the CSRD and the 2024 Regulations which, as reported in our previous client briefing here, brought more companies into scope than had been intended by the CSRD.

The inconsistencies also brought certain Irish companies into scope for sustainability reporting sooner than intended by the CSRD and made these companies, which included SMEs listed on an EU regulated market, subject to full, instead of limited, reporting requirements under the 2024 Regulations. These inconsistencies have now been addressed by the 2025 Regulations.

In addition, many of the inconsistencies, identified in our earlier briefing, which made the exemptions available under the 2024 Regulations for individual and consolidated sustainability reporting more restrictive than the equivalent CSRD exemptions, have also now been corrected and brought into line with the CSRD.

Many of these inconsistencies arose from how “applicable” companies (ie companies that are subject to the corporate sustainability reporting requirements) were defined under the 2024 CSR Regulations and Part 28 of the Companies Act 2014 (CA 2014).

Under the 2024 Regulations, if a company was an “ineligible entity” or, was a holding company and had an ineligible entity in its group, this removed that company out of the definition of micro, small and medium companies and small and medium groups as defined in the CA 2014 and these companies were “deemed” to be “large” companies.

An “ineligible entity”, under Irish law, includes a number of different company types including Public Limited Companies (PLCs) and companies that have shares listed on an EU regulated market, therefore this resulted in all PLCs listed and unlisted (regardless of size), and all SMEs listed on an EU regulated market, being caught as part of the “wave 2” companies. SMEs listed on an EU regulated market were also being subject to full, instead of limited, reporting requirements under the 2024 Regulations. Holding companies that were “deemed” to be large for the same reasons (regardless of size) were also caught under the 2024 Regulations for consolidated sustainability reporting.

As the 2025 Regulations have now removed the reference to “ineligible entity” from the definitions of all the different company sizes for the purpose of sustainability reporting in Part 28 of the CA 2014, it will only be those companies that meet the relevant size thresholds that will come within the scope of the Irish Corporate Sustainability Reporting (CSR) Regulations and Part 28 of the CA 2014.

The arrival of the 2025 Regulations will be very much welcomed particularly for those companies that were unintentionally caught by the 2024 Regulations and which should not have been brought into scope eg unlisted PLCs which meet the thresholds for small or medium companies. These companies now fall outside the scope of the Irish CSR Regulations by the amendments made to the CA 2014 by the 2025 Regulations. In addition, SMEs listed on an EU regulated market will now not be classified as “wave 2” companies but instead will come into scope later, in line with the CSRD, as “wave 3” companies and should also be entitled to avail of the limited sustainability reporting obligations. The exemptions available under the Irish CSR Regulations for individual and consolidated sustainability reporting are now also more in line with the equivalent CSRD exemptions.

While Part 28 of the CA 2014 as amended by the 2025 Regulations is now much more in line with the CSRD, further amendments to the scope of the CSRD are expected over the coming months to amend the overall scope of the CSRD to help boost EU competitiveness as part of the Commission’s sustainability omnibus package.

For assistance or further advice on the Irish CSR Regulations, please contact a member of our Eversheds-Sutherland team.

Thanks to Tracy MacDevitt (Professional Support Lawyer, Corporate) for contributing to this briefing.