Ready for the Green Deal? An Update for the Sports Industry

• European Green Pact Update 2025
• Navigating Sustainability: a major challenge for fashion brands in 2025
• Reduced reporting obligations
• Changes for CSRD & CS3D
• Impacts on the textile and action sports industry
• SMEs and reporting
• Concerns and challenges
• Timetable & outlook
• Green Deal 2025: The main changes at a glance

The Omnibus Directive, adopted by the European Commission, brings significant changes to several existing regulations, notably the CSRD (Corporate Sustainability Reporting Directive) and the CSDD (Corporate Sustainability Due Diligence Directive). However, double materiality remains, reporting thresholds and frequencies evolve, and essential quantitative indicators are retained. With these changes, only 20% of European companies are concerned.

It is based on the principle that large companies have :

• a greater impact on society and the environment
• A greater capacity to collect and analyze complex data
• Greater influence over their value chains

This redesign aims to optimize the effectiveness of CSRD by targeting the players most likely to positively influence large-scale sustainability practices.

We are taking concrete steps to cut red tape and make EU rules more accessible and effective for citizens and businesses. The package of measures presented today is the first step in our considerable simplification efforts in all areas of legislation...

Stéphane Séjourné, Executive Vice-President for Prosperity and Industrial Strategy

To date, and if the European Parliament and Council approve the directive, here are the changes planned:

• The threshold for application of the Directive on Corporate Sustainability Reporting (CSRD) has been raised to 1,000 employees (previously 250) and sales of 50 million euros or a balance sheet of 25 million euros.
• Other companies still have the option of voluntary reporting.
• The volume of data to be reported has been reduced, with the aim of simplifying procedures for companies. The estimated reduction in the administrative burden is around 25% for large companies, and around 35% for SMEs wishing to report voluntarily.
• The entry into force of the obligations is delayed by one year to July 26, 2028.
• Compliance processes and communication with the authorities will be facilitated, notably through greater use of digital tools. In addition, the reporting templates to be used will be reduced by around 70%.

Main changes to the CSRD:

• Postponement of entry into force: The application of reporting obligations is postponed by two years, until 2028.
• A significant reduction in the volume of data to be reported under the European Sustainability Reporting Standards (ESRS). This simplification is characterized by a significant reduction in narrative and semi-narrative indicators, in order to focus on quantitative indicators.
• Removal of sector-specific reporting standards, reduction of mandatory data for certain standards & a focus on quantitative data and key metrics. This is not unanimously supported in the textile sector, as it makes certain key points unclear, particularly in the area of sourcing.
• The focus on quantified and verifiable data is preferred to declarations of actions to be taken to reduce negative impacts. We mustn't underestimate the areas for improvement, as this will enable us to stay one step ahead of the competition and scale them up.

The changes introduce limitations on the information that the companies concerned can request from their SME suppliers... the textile and clothing sector would have been the preferred one for the development of sectoral standards, being a high-risk sector. However, this is highly unlikely.

Natalia Yerashevich, Head of Transparency and Supply Chain at Ohana Public Affair

Main changes to CS3D & due diligence:

• Due diligence obligations now focus solely on direct suppliers (rank 1), and not on the entire value chain. It is therefore limited to the company's direct suppliers, barring exceptions and cases of proven risk.
• The European civil liability of companies for breaches of their duty of care obligations has been abolished, as have the associated financial penalties.
• Audits and reporting obligations will be required every 5 years, rather than annually, to ensure compliance with these requirements.

The postponement follows concerns expressed by various stakeholders, including member states such as Germany and Italy, that the original timetable imposed excessive administrative burdens on companies.

The simplification of regulations could facilitate innovation in sustainable materials, a key area for the outdoor industry. However, the industry must remain vigilant and watch out for forthcoming decrees as sector-specific standards are abolished. Outdoor brands may have to justify their environmental claims more rigorously, which could stimulate the adoption of truly sustainable practices. With regard to CS3D, by definition, a commitment restricted to rank 1 could lead to reduced transparency in supply chains. And could slow down efforts to improve production conditions in countries like Bangladesh, Vietnam and India, for example. Whereas potential scandals & bad publicity don't slow down when problems arise.

On the other hand, as part of the omnibus directive's "New Deal for Consumers" initiative, outdoor companies will have to review their pricing processes to comply with the new restrictions on price manipulation. For example, they will have to ensure that advertised discounts are based on reference prices that have been stable for at least a month. The increased transparency demanded on online marketplaces will oblige outdoor brands to provide more detailed information on their products and services.

To date, with the omnibus directive, SMEs are no longer concerned by the CSRD. Thanks to the introduction of a voluntary standard VSME (Voluntary reporting standard for SMEs) for companies not concerned by the CSRD, there remains the possibility of anticipating future regulations by structuring their management of quantitative indicators. If they fail to prepare for these new requirements, they could potentially lose major customers. On the other hand, the EU is pushing for the digital transformation of SMEs, which can represent a significant initial investment in time and resources; this change in the law enables a smoother adaptation to these challenges. To sum up:

• VSME is much "lighter" in terms of methodology and publication requirements than CSRD's ESRS standards.
• Structure: VSME is divided into two modules (basic and complete) with a total of 20 disclosure requirements, whereas the complete CSRD comprises around 700 indicators.
• Materiality analysis: VSME does not include double materiality analysis, unlike CSRD.
• VSME helps to meet the sustainability demands of business partners, and can facilitate access to responsible financing.
• Enhanced brand image: Adopting VSME can boost stakeholder confidence and attract customers who value eco-responsible practices..
• Commitment to the low-carbon transition: VSME can contribute to European climate objectives.

According to Natalia Yerashevich, Head of Transparency and Supply Chain at Ohana Public Affair :

If the European Commission's proposal published on February 26, 2025 becomes the final text, many listed mid-sized companies and SMEs will no longer have CSRD reporting obligations. They will still be able to report using voluntary reporting standards. For large European and non-European companies, the scope of reporting will be considerably reduced.

CSR and ESG professionals have a number of concerns regarding the omnibus directive:

• Weakening of environmental and social standards: the simplification project could lead to a weakening of the environmental standards voted in with the European Green Deal.
• Legal uncertainty: the planned revision of the CSRD raises questions about the concrete changes and their date of entry into force, creating a period of uncertainty for companies.

To balance its credible commitment to sustainability, outdoor brands can adopt the following strategies:

• Physical sustainability: invest in eco-design and repairability of products to reduce environmental impact while meeting consumer expectations.
• Circular economy: Implement repair and resale initiatives to extend product life cycles, like Arc'teryx™, Rip Curl™, Vaude™ to others.
• Transparent communication with proof: Establish clear and consistent communication on sustainability efforts to build consumer trust. Paying attention to the diktat of "responsible" product performance, which is difficult to uphold, will be heavily scrutinized by fraud control.
• Certification and partnerships: Collaborate with recognized environmental organizations and obtain certification labels to validate sustainability commitments.
• Holistic approach: Integrate sustainability at every stage of the process, from design to distribution, to guarantee long-term growth while meeting climate challenges.

This announcement is part of a wider drive by the Commission to rebalance sustainability requirements with the competitiveness needs of businesses. While maintaining the European Union's climate objectives. Regulatory change could encourage a deeper transformation towards truly sustainable business practices and products in the outdoor sector.

EU companies will benefit from streamlined rules on sustainable finance disclosure, sustainability due diligence and taxonomy.

Ursula von der Leyen, President of the European Commission

According to Natalia Yerashevich, Head of Transparency and Supply Chain at the law firm Ohana Public Affair the Commission's proposal has been published, it now has to be examined by the Parliament and the Council. They can either reject it or introduce their own amendments to the text, which will be negotiated between them. This will happen over the next few months."

The very positive side remains the possibility of a shift from strict regulation to more voluntary commitments to sustainability. And that the non-mandatory aspect will add even more value to the commitments, while leaving the way open for a timetable more suited to smaller structures.

Sustainability and innovation will also be at the heart of ISPO 2025 in Munich, from NOV. 30 to DEC. 02, 2025. Brands will discover how to assume their responsibility towards the environment while complying with new legal requirements to secure their market position. Be there!