Carbon Accounting After Omnibus: What Europe's Regulatory Reset Means for Your Business

On March 18, 2026, the EU's Omnibus I directive entered into force and did something that would have been unthinkable two years earlier: it removed roughly 80% of companies from mandatory sustainability reporting under the CSRD. At the same time, the Carbon Border Adjustment Mechanism completed its first quarter of full operation, with over 12,000 importers applying for authorized declarant status in the opening week alone. These two facts — one a retreat, the other an advance — define the state of carbon accounting in Europe right now.

If you're a sustainability officer or procurement lead trying to figure out what this means for your sourcing decisions, the short answer is: the regulatory floor just moved, but the market ceiling didn't.

The Omnibus Rewrite: Fewer Companies, Sharper Rules

The Corporate Sustainability Reporting Directive was supposed to be the EU's signature transparency instrument. When it passed in 2022, the original scope captured any company meeting two of three criteria: more than 250 employees, turnover above €50 million, or a balance sheet exceeding €25 million. That pulled in tens of thousands of European businesses across every sector.

Omnibus I, published as [Directive (EU) 2026/470](https://eur-lex.europa.eu/eli/dir/2026/470) on February 26, 2026, rewrote those thresholds dramatically. CSRD now applies only to companies with more than 1,000 employees and net annual turnover exceeding €450 million. Listed SMEs — originally slated as Wave 3 reporters — are fully exempt. The phased wave system is effectively dead.

The numbers tell the story. Under the original directive, approximately 50,000 companies across the EU would have been in scope. After Omnibus, estimates from legal firms like Ropes & Gray suggest the reduction is closer to 90%. Norton Rose Fulbright puts it at 80%. Either way, a huge swath of mid-market European businesses just lost their mandatory reporting obligation.

But the simplification goes deeper than headcount. EFRAG's draft simplified European Sustainability Reporting Standards, published in December 2025, reduced mandatory data points by 61% and eliminated all voluntary disclosures. The European Commission must adopt the final version by September 2026, with the revised standards applying from financial year 2027.

For value chain partners, there's a new "protection regime." Companies with fewer than 1,000 employees now have the legal right to refuse information requests from CSRD-reporting companies that go beyond what the forthcoming voluntary standards require. This is the "value-chain cap" — a direct response to complaints that CSRD was creating a compliance cascade onto smaller suppliers.

Why Carbon Accounting Demand Is Rising Anyway

Here's what the Omnibus headlines miss: the companies that remain in scope are exactly the ones with the biggest, most complex carbon accounting needs. These are enterprises running multi-country operations with sprawling supply chains, and their reporting requirements — while simplified — still demand audit-grade emissions data across Scopes 1, 2, and 3.

The global carbon accounting software market was valued at roughly $19–22 billion in 2025, depending on which analyst you ask. MarkNtel Advisors projects it to reach $96 billion by 2032, growing at a 25.7% CAGR. Fortune Business Insights pegs 2026 at $27.5 billion. The numbers vary, but the direction doesn't: this market is accelerating, not contracting.

Three forces explain the disconnect between regulatory pullback and market growth.

First, CBAM is now real money. Since January 1, 2026, EU importers of steel, aluminium, cement, fertilizers, electricity, and hydrogen must hold authorized CBAM declarant status and will purchase certificates priced against EU ETS auction prices. The first annual declaration and certificate surrender is due by September 30, 2027, covering all 2026 imports. Companies that can't produce verified emissions data for their imported goods face default values — which are set at the highest emission intensity observed among countries with reliable data. That's a direct financial penalty for poor carbon accounting.

Second, the companies that fell out of CSRD scope aren't off the hook. They sit in the value chains of companies that are in scope. Even with the value-chain cap, those larger enterprises need emissions data from their suppliers. The cap limits what can be legally demanded, but it doesn't limit what procurement teams prefer. Suppliers who can provide clean, structured carbon data will win contracts over those who can't.

Third, carbon accounting has decoupled from CSRD. California's SB 253 requires companies with over $1 billion in revenue to report Scope 1 and 2 emissions from 2026. The UK's SECR framework has its own requirements. The ISSB standards are gaining traction globally. A European mid-market company that stopped investing in carbon accounting because Omnibus removed their CSRD obligation would be making a one-jurisdiction bet in a multi-jurisdiction world.

The Provider Landscape: Who's Building What

The European carbon accounting software market has matured rapidly since the CSRD was first proposed. A handful of platforms now dominate, each with distinct positioning.

Normative, headquartered in Stockholm, has positioned itself as the science-first option, with representation in GHG Protocol Scope 3 and ISO working groups. Their Carbon Network facilitates supplier-specific data capture — useful for companies pushing beyond spend-based estimates. Clients include Hitachi Rail, Vodafone, Nordea, and Hertz. If you're sourcing [carbon accounting providers in Scandinavia](https://sourceregister.eu/en/carbon-accounting), Normative is the benchmark.

Sweep, founded in France with offices in London and Denver, targets large enterprises with complex value chains. IDC ranked Sweep as a market leader in their 2025 Vendor MarketScape. Their platform structures carbon management around "Track, Disclose, Act" — combining emissions measurement with scenario analysis and collaborative supply chain tools. L'Oréal, SSE, and Lacoste are notable customers.

Greenly, also Paris-based, has carved out the SMB and mid-market segment with over 400 customers and a focus on accessible UX. They recently launched a CBAM compliance module, signaling that even SMB-focused tools see border carbon pricing as a growth vector. Greenly serves companies like Ubisoft and HelloFresh.

Plan A, operating from Berlin, Munich, Paris, and London, targets European mid-market to large enterprises across software, finance, and fashion. Their "decarbonization-first" approach and TÜV-certified methodology appeal to companies navigating the [German carbon accounting market](https://sourceregister.eu/de/carbon-accounting).

Beyond the pure-play platforms, enterprise software giants are embedding carbon accounting into their existing stacks. SAP has integrated sustainability modules across S/4HANA, SuccessFactors, and Ariba — claiming over 2,000 customers using those features by 2023. IBM's Envizi platform aggregates utility and asset data into audit-ready emissions inventories.

Pricing spans a wide range. SMB solutions now start around €3,000–5,000 per year, down from €5,000+ two years ago. Mid-market tools run €25,000–50,000 annually. Enterprise deployments can exceed €200,000, with implementation adding 20–50% in year one.

For procurement teams evaluating providers across multiple European markets, SourceRegister's [carbon accounting directory](https://sourceregister.eu/en/carbon-accounting) covers verified providers in [Germany](https://sourceregister.eu/de/carbon-accounting), [France](https://sourceregister.eu/fr/carbon-accounting), [Sweden](https://sourceregister.eu/se/carbon-accounting), the [UK](https://sourceregister.eu/gb/carbon-accounting), and [Spain](https://sourceregister.eu/es/carbon-accounting).

CBAM in Practice: The First Quarter

The Carbon Border Adjustment Mechanism entered its definitive phase on January 1, 2026, and the operational rollout has been smoother than many expected. The EU reported over 12,000 economic operators applying for CBAM authorization by January 7, with more than 4,100 receiving authorized declarant status immediately. In the first six days, customs systems processed 10,483 import declarations covering 1.66 million tonnes of CBAM goods.

The mechanism covers six sectors: cement, iron and steel, aluminium, fertilizers, electricity, and hydrogen. Certificate prices are set quarterly in 2026 (shifting to weekly from 2027), pegged to EU ETS auction clearing prices. Importers can deduct carbon prices already paid in the country of origin — which is why countries like India, Turkey, Brazil, and Indonesia are accelerating their own carbon pricing systems.

The Omnibus simplification package also touched CBAM. A de minimis threshold exempts importers bringing in 50 tonnes or less of CBAM goods annually. The quarterly certificate-holding requirement dropped from 80% to 50% of embedded emissions. Default emission values are now available for countries lacking reliable data.

For carbon accounting providers, CBAM is an enormous new market. Every authorized CBAM declarant needs verified emissions data for imported goods. That data must come from suppliers — often in countries where emissions tracking is rudimentary. The firms that can bridge this gap between EU compliance requirements and non-EU supplier capabilities will capture outsized value.

What This Means for 2027 and Beyond

The regulatory picture for 2027 is now sharply defined. Companies above the Omnibus thresholds will report on financial year 2027 data, with first reports due in 2028, using the simplified ESRS that the Commission will finalize by September 2026. Member states have until March 2027 to transpose the Omnibus directive into national law — and early indications suggest meaningful variation in how countries approach this.

For non-EU companies, the timeline is slightly later: Wave 4 reporting on FY 2028 data, with reports due in 2029. The threshold is €450 million in EU net turnover plus an EU subsidiary or branch generating over €200 million.

The Commission has also signaled a broader CBAM review, with a legislative proposal potentially expanding scope to additional sectors and downstream goods from 2028. If CBAM extends to cover more of the sectors already under the EU ETS, the demand for granular carbon accounting at the product level — not just the corporate level — will spike.

Two things are worth watching. First, the review clauses built into both CSRD and CSDDD mean the scope could tighten again. The Omnibus was a political response to competitiveness concerns raised by the Draghi and Letta reports in late 2024. Political winds shift. Second, voluntary reporting is filling the gap left by the regulatory pullback. Companies that built CSRD-ready infrastructure over the past two years aren't dismantling it. They're using it as a competitive differentiator in customer and investor conversations.

The carbon accounting industry isn't waiting for regulators to decide the next move. The tools are sharper, the data is better, and the business case — driven by CBAM costs, supply chain pressure, and multi-jurisdictional disclosure requirements — stands independent of any single directive.

For European procurement professionals, the practical takeaway is this: the number of companies required to report on carbon has shrunk. The number of companies that need to understand their carbon exposure has not.