ESG Perspective is Pierag’s monthly ESG and Sustainability newsletter, created to foster informed, forward-looking conversations on sustainability and responsible business. The February 2026 edition covers one of the most concentrated months of sustainability regulatory activity in recent years: the formal completion of the EU Omnibus I simplification package, the entry into force of the EU Taxonomy Simplifying Delegated Act, the publication of the UK’s ISSB-aligned sustainability reporting standards, and continued carbon market and governance reform globally. For CFOs, sustainability leads, and audit committees, the developments in this edition are active compliance inputs, not background policy.
Download the February 2026 ESG Perspective Edition (PDF)
EU Taxonomy and Reporting Frameworks: Omnibus I Formally Completed
The most significant development of February 2026 was the formal completion of the EU’s Omnibus I simplification package. The directive amending CSRD and CSDDD was published in the EU Official Journal on 26 February 2026. [1] Member States must transpose most CSRD provisions by 19 March 2027 and CSDDD amendments by 26 July 2028. The Omnibus I amendments raised the CSDDD compliance threshold to companies with more than 5,000 employees and EUR 1.5 billion in turnover, with the first mandatory CSDDD compliance date moved to July 2029. Climate Transition Plans were removed from the CSDDD scope, with guidelines expected by mid-2027.
Separately, the EU Taxonomy Simplifying Delegated Act entered into force on 28 January 2026, reducing Article 8 reporting data points by approximately 70% and introducing a materiality threshold allowing companies to exclude economic activities below 10% of total revenue, capital expenditure, or assets from Taxonomy assessment. [2] Companies subject to CSRD can apply the simplified measures for 2025 financial year reporting.
For organisations preparing BRSR Core disclosures alongside EU-facing sustainability reporting, Pierag’s ESG Reporting and Assurance practice supports alignment across BRSR Core, CSRD-ESRS, and ISSB frameworks.
ISSB Adoption: UK Standards Published, Global Momentum Continues
The UK published its ISSB-aligned Sustainability Reporting Standards, UK SRS S1 and S2, on 25 February 2026, with mandatory application expected from 1 January 2027 for listed companies, subject to FCA rulemaking. [1] ISSB-aligned standards are now mandatory or in active regulatory development across approximately 40 jurisdictions, including Australia, Singapore, Japan, Malaysia, South Korea, China, and the Philippines. [3] IOSCO’s endorsement signals support for adoption across the 130 jurisdictions it represents.
For Indian companies with global investors, BRSR Core metrics are designed to be mappable to ISSB and GRI requirements, making BRSR Core implementation a practical foundation for meeting ISSB-aligned investor disclosure expectations.
Carbon Markets and Climate Transition Policy
The EU ETS entered a phase of tightening free allowances, reinforcing the financial materiality of carbon pricing for manufacturing, energy, and transport-intensive businesses. From 1 January 2026, the EU CBAM moved into its definitive phase, with the Q1 2026 certificate price confirmed at EUR 75.36 per tonne of CO2. [4] For risk teams and CFOs, the convergence of CBAM obligations and domestic carbon market development requires integration into capital planning, procurement strategy, and supply chain due diligence. Pierag’s ESG and Sustainability Advisory supports organisations in assessing carbon transition risk and building disclosure-ready GHG data infrastructure.
Environmental Protection and Governance Reform
The EU Nature Restoration Law entered its implementation phase, with member state national restoration plans due by mid-2026. The ISSB has identified nature-related risks as a next major standard-setting project, drawing on TNFD frameworks. [3] For companies with supply chains in forestry, agriculture, and extractive sectors, nature-related disclosure is moving from voluntary reporting toward a structured, assurance-ready expectation.
Board-level oversight of sustainability risks is increasingly embedded in regulatory frameworks rather than treated as governance best practice. CSRD and ISSB-aligned standards both require disclosures on board-level governance of sustainability risks.
Frequently Asked Questions
What is Omnibus I and what did it change?
Published 26 February 2026, Omnibus I amends CSRD and CSDDD, raising the CSDDD threshold to 5,000 employees and EUR 1.5 billion turnover, with mandatory compliance moved to July 2029. Member States must transpose CSRD provisions by 19 March 2027. [1]
What changed under the EU Taxonomy Simplifying Delegated Act?
In force from 28 January 2026, it reduces Article 8 data points by approximately 70% and introduces a 10% materiality threshold. Applies to 2025 financial year reporting. [2]
How many countries have adopted ISSB standards?
Approximately 40 jurisdictions, including the UK, Australia, Japan, South Korea, Singapore, Malaysia, China, and the Philippines. [3]
Where can I find other editions of Pierag’s ESG Perspective?
All editions are in Pierag’s Insights hub.
References
[1] Freshfields. (2026, February). Sustainability reporting round-up: Omnibus I directive and UK SRS published. Retrieved from https://www.freshfields.com/en/our-thinking/blogs/sustainability/sustainability-reporting-round-up-news-from-key-markets-102mllq
[2] Green Calculus. (2026). EU Taxonomy Regulation: Simplifying Delegated Act in force 28 January 2026. Retrieved from https://greencalculus.com/standards/eu-taxonomy-regulation/
[3] S&P Global Sustainable1. (2026, January). Where does the world stand on ISSB adoption? Retrieved from https://www.spglobal.com/sustainable1/en/insights/research-reports/issb-january-2026
[4] International Carbon Action Partnership (ICAP). (2026). EU ETS: Definitive CBAM phase from 2026. Retrieved from https://icapcarbonaction.com/en/ets/eu-emissions-trading-system-eu-ets
