The European Union just made life considerably easier for asset managers drowning in sustainability paperwork. A draft delegated regulation published by the European Commission in May 2026 proposes slashing mandatory ESG reporting datapoints by over 60%, with total datapoints expected to decline by more than 70%.
What’s actually changing
The core of the proposal is straightforward. Asset managers who handle investments under fiduciary duty, without retaining the risks or rewards of ownership, would no longer need to provide detailed environmental, social, and governance disclosures on those client-held assets.
The changes fall under the Omnibus I package, which the EU designed to simplify the Corporate Sustainability Reporting Directive (CSRD) and its associated European Sustainability Reporting Standards (ESRS). The Omnibus I Directive reached political agreement in December 2025 and entered into force in March 2026, narrowing the CSRD’s scope and calling for revisions to the ESRS.
Expected per-company reporting cost savings are estimated to exceed 30%. The draft regulation was open for public consultation until June 3, 2026. Revised standards are anticipated to take effect for financial years beginning January 1, 2027, though select firms may opt for early adoption during fiscal year 2026.
