Following Tuesday’s vote to fast track this legislation, the European Parliament has voted on 3 April 2025 in favour of the Stop the Clock Directive (COM/2025/80) postponing the commencement of Corporate Sustainability Reporting Directive (CSRD) for companies due to come within its scope in 2025 and 2026 and extending the transposition of the Corporate Sustainability Due Diligence Directive (CSDDD).
The Stop the Clock Directive when it becomes effective will:
- postpone the application of the sustainability reporting obligations for those required to comply with sustainability reporting obligations in respect of their 2025 or 2026 financial years by two years to 2027 and 2028 respectively and
- extend the deadline for member states to introduce legislation implementing CSDDD by one year to 26 July 2027 and introduce new thresholds.
The text of the Stop the Clock Directive was adopted without any amendments with 531 votes in favour, 69 against and 17 abstentions.
Next steps - Europe
The Council need to formally approve the Directive.
The Directive will then be published in the Official Journal.
The Stop the Clock Directive will enter into force the day after its publication under Article 4.
Next steps - Ireland
Member States then have until 31 December 2025 to bring in national legislation implementing the provisions.
The Minister for Enterprise, Tourism and Employment, Peter Burke issued a press release on Monday, 31 March 2025 indicating that amendments will be made to the scope of the existing Irish legislation governing the CSRD to further clarify and reduce the scope of companies covered by the existing Irish legislation.
The press release also confirmed that Minister Burke is “also focussed on quickly implementing the EU’s ‘Stop the Clock’ proposal together with the changes proposed by the wider Omnibus, once these are adopted at EU level.” Hopefully, this will mean that Ireland will act promptly and implement the imminent postponements in the Stop the Clock Directive.
For more information, please contact author Michelle McLoughlin, Senior Knowledge Consultant, or your usual contact in the Corporate or ESG groups.
