At a time when European insurers could play a key role in driving the EU transition towards a more sustainable and resilient economy, proposals currently on the table to change the company size and turnover thresholds would significantly reduce transparency and accountability in the European insurance sector.

This is especially concerning given insurers’ systemic role in the financial system. By reducing the availability of reliable sustainability data, insurers cannot adequately assess and manage their financial risks, with serious consequences for financial stability and, by extension, the wider economy and society.

Marika Carlucci, EU Senior Policy Officer at ShareAction said:

“If the current proposals go ahead, a vast majority of insurers—some of whom manage billions in assets—could be exempted from sustainability reporting obligations overnight. That would leave investors, supervisors, and citizens in the dark about how insurers are managing their sustainability-related financial risks, while adding further instability to the financial system.

"The green transition relies on robust, comparable data. Weakening the CSRD now risks making financial markets less transparent, less stable, and less prepared for the challenges ahead. This is even more striking for insurers – the ones managing the risks of climate change and footing the bill for the extreme events it fuels. EU policymakers must reconsider these proposals before they undo years of progress

The research also highlights further regulatory backsliding, pointing to the proposals to remove the obligation for companies to implement transition plans under the Corporate Sustainability Due Diligence Directive (CSDDD). Without such plans, companies may delay or avoid efforts to reduce their environmental impact, exacerbating extreme weather events responsible for damages covered by insurers. At the same time, the absence of forward-looking strategies would make it harder for insurers to properly assess and mitigate sustainability-related risks, with potential additional risks to financial stability.

Finally, the research outlines how the proposed Omnibus I changes could also affect other key legislations for the insurance sector, such as the Sustainable Finance Disclosure Regulation (SFDR) and Solvency II, further undermining insurers’ key role in driving decarbonisation and safeguarding financial stability.

Notes to editor

The full paper is available here.

Breakdown of CSRD exemption estimates for European insurers, based on different proposals currently on the table:

• Under the 1,000-employee threshold currently proposed, 51% of insurers currently subject to CSRD would be exempted.
• If the turnover threshold were raised to €450 million, as recently suggested by the European Parliament’s rapporteur, 67% would be exempted.
• If the employee threshold were further increased to 3,000, as also recently floated in discussions at the European Parliament, 74% would fall outside the scope.
• This would then become 82% with a 5,000 employee threshold.
• Consequently, combining a 3,000 employee threshold with a turnover threshold of €450 million would reduce the number of insurers reporting under the CSRD by 81%; 85% if the former is raised to 5,000.

These figures are based on new analysis conducted by FairFin Research for ShareAction, using data in the financial database Refinitiv/LSEG Workspace and a sample of 324 European insurance entities.

While every effort has been made to ensure the information in the publication is correct, ShareAction cannot guarantee its accuracy and shall not be liable for any claims of any nature in connection with information contained in the document.