Introduction: What the Omnibus Means for Construction Companies
The Stop-the-Clock Regulation delays CSRD reporting obligations by two years for companies not yet reporting — giving construction firms until 2028 or 2029 to prepare, depending on company size.
The Corporate Sustainability Reporting Directive (CSRD) was set to bring unprecedented transparency to corporate environmental, social, and governance (ESG) performance across the EU. For the construction sector, CSRD meant that large contractors, building-material manufacturers, and property developers would need to report detailed sustainability data — including Scope 3 supply-chain emissions — under the European Sustainability Reporting Standards (ESRS).
Then came the Omnibus. In February 2025, the European Commission published its Omnibus Simplification Package, proposing significant changes to the CSRD’s scope and timeline. In November 2025, the co-legislators agreed on the Stop-the-Clock Regulation, formally delaying CSRD reporting obligations by two years for companies that had not yet started reporting under the directive.
This article explains what the Stop-the-Clock Regulation means for construction-sector companies, how it affects supply-chain reporting, why EPDs remain relevant despite the delay, and what practical steps companies should take during the extended preparation window.
CSRD and the Construction Sector: Why It Matters
What CSRD Requires
The CSRD requires in-scope companies to report sustainability information under the European Sustainability Reporting Standards (ESRS). For construction companies, the most impactful requirements include:
- ESRS E1 — Climate Change: Disclosure of greenhouse gas emissions (Scope 1, 2, and 3), transition plans, and climate-related risks and opportunities.
- ESRS E5 — Resource Use and Circular Economy: Reporting on material flows, waste management, and circular economy practices.
- ESRS S2 — Workers in the Value Chain: Disclosure on working conditions, health and safety, and human rights in the supply chain.
- Double materiality assessment: Identification of sustainability topics material to both the company’s financial performance (financial materiality) and its environmental/social impact (impact materiality).
Scope 3 is the construction sector’s biggest challenge: For most construction companies, Scope 3 emissions — particularly purchased goods and services (Category 1) and use of sold products (Category 11) — represent 80–95% of their total carbon footprint. Reporting these emissions requires environmental data from suppliers — and the most credible source of product-level environmental data is the EPD.
The Original CSRD Timeline
The CSRD originally established a phased roll-out:
| Wave | Companies in scope | First reporting year (original) | First report published (original) |
|---|---|---|---|
| Wave 1 | Companies already subject to NFRD (>500 employees, listed) | FY 2024 | 2025 |
| Wave 2 | Large companies meeting 2 of 3 criteria (>250 employees, >€50M turnover, >€25M balance sheet) | FY 2025 | 2026 |
| Wave 3 | Listed SMEs | FY 2026 | 2027 |
Most large construction companies — contractors, building-material groups, property developers — fall into Wave 2. Listed construction SMEs would be captured in Wave 3.
The Omnibus and Stop-the-Clock: What Changed
The Omnibus Simplification Package
The European Commission’s Omnibus Simplification Package, published on 26 February 2025, proposed three major changes to the CSRD:
- Scope reduction: Raising the thresholds for Wave 2 to >1,000 employees and >€50M turnover, removing an estimated 80% of companies from CSRD scope.
- Simplified reporting for smaller companies: Introducing a voluntary simplified standard (VSME) for companies below the new thresholds.
- Two-year delay: Postponing the first reporting year for Wave 2 and Wave 3 companies.
The Stop-the-Clock Regulation
While the full Omnibus proposal works through the legislative process, the co-legislators fast-tracked the timeline element through a standalone Stop-the-Clock Regulation, agreed in November 2025. This regulation delays CSRD reporting deadlines by two years for companies that have not yet started reporting:
| Wave | Original first reporting year | Delayed first reporting year | First report published |
|---|---|---|---|
| Wave 1 | FY 2024 | No change — already reporting | 2025 (already published) |
| Wave 2 | FY 2025 | FY 2027 | 2028 |
| Wave 3 | FY 2026 | FY 2028 | 2029 |
Stop-the-Clock does NOT eliminate CSRD obligations: The delay applies to the timeline, not the substance. Wave 2 and Wave 3 companies will still need to report under ESRS — just two years later. The Omnibus scope changes (if adopted as proposed) may reduce the number of companies in scope, but this is a separate legislative process that is not yet finalised.
Impact on the Construction Value Chain
Large Contractors and Material Groups (Wave 1–2)
The largest construction groups — international contractors, major building-material manufacturers, and listed property developers — are likely in Wave 1 (already reporting) or Wave 2 (now delayed to FY 2027). For Wave 2 companies, the two-year delay provides additional time to:
- Build internal ESG data collection systems
- Conduct double materiality assessments
- Establish Scope 3 emission calculation methodologies
- Engage suppliers for environmental data (including EPDs)
- Select and implement reporting software
However, the delay should not be mistaken for a reprieve from market pressure. Wave 1 companies are already reporting, and their Scope 3 disclosures create upstream data requests that flow through the supply chain. A Wave 2 construction material manufacturer may not need to publish its own CSRD report until 2028, but it may receive data requests from Wave 1 customers in 2025–2026.
Mid-Size Manufacturers and Subcontractors
Many mid-size construction-product manufacturers and specialised subcontractors fall below the original Wave 2 thresholds and may fall outside CSRD scope entirely if the Omnibus threshold changes are adopted. However, even companies not directly subject to CSRD will feel its effects through the value chain:
- Data requests from customers: In-scope companies need Scope 3 data from their suppliers. This creates a cascade of data requests throughout the construction supply chain.
- Procurement criteria: Some large contractors and developers are beginning to include sustainability data requirements (including EPDs) in their procurement specifications and supplier qualification processes.
- Financial institution requirements: Banks and investors applying the EU Taxonomy and sustainable finance regulations may require sustainability data from companies seeking financing for construction projects.
The Scope 3 Data Challenge
For construction companies, calculating Scope 3 emissions — particularly Category 1 (purchased goods and services) — requires product-level environmental data from hundreds or thousands of suppliers. The challenge is immense:
| Data source | Quality | Availability | Credibility for CSRD |
|---|---|---|---|
| Producer-specific EPD | High — verified LCA data | Growing but incomplete | Highest — third-party verified |
| Industry-average EPD | Medium — sector average data | Available for major product groups | Good — recognised methodology |
| LCA database values | Medium — generic assumptions | Broadly available | Acceptable with documentation |
| Emission factor databases | Low–Medium — high-level factors | Widely available | Acceptable for screening |
| Supplier questionnaires | Variable — unverified | Depends on supplier cooperation | Low — no independent verification |
EPDs as Scope 3 infrastructure: An EPD provides exactly the product-level, third-party-verified environmental data that construction companies need for Scope 3 reporting. When a manufacturer supplies an EPD with their product, they are effectively providing their customer with a plug-and-play Scope 3 data module. This is why EPDs are increasingly described as supply-chain compliance infrastructure, not just sustainability certificates.
Why EPDs Remain Relevant Despite the Delay
Market Pressure Doesn’t Stop
The Stop-the-Clock delays regulatory reporting deadlines, but it does not pause the broader market transition toward sustainability transparency. Several factors continue to drive EPD demand independently of the CSRD timeline:
- EPBD recast: Whole-life carbon calculation for new buildings (transposition deadline May 2026) requires product-level GWP data — sourced primarily from EPDs.
- CPR 2024/3110: GWP declaration as a regulated product characteristic will require LCA data from EPDs.
- Buy Clean policies: Public procurement mandates in the EU, US, Canada, and Australia require EPDs regardless of CSRD timelines.
- Green building certification: BREEAM, LEED, DGNB, and HQE continue to award credits for products with EPDs.
- EU Taxonomy: Substantial contribution criteria for climate change mitigation reference embodied carbon, for which EPDs provide the evidence base.
Preparation Time Is Finite
The two-year delay is a preparation window, not a permanent exemption. Companies that use the extra time to build EPD programmes, collect Scope 3 data, and establish reporting workflows will be in a strong position when their reporting obligation begins. Companies that treat the delay as an excuse to postpone action will face the same challenge under greater time pressure.
Practical Steps During the Preparation Window
- Conduct a double materiality assessment now — this foundational exercise determines which ESRS topics are material to your company and shapes the scope of your entire reporting effort.
- Map your Scope 3 hotspots — identify the purchased materials and services that contribute most to your carbon footprint. Prioritise EPD collection for these high-impact categories.
- Request EPDs from key suppliers — begin supplier engagement now. Suppliers who are not yet providing EPDs may need 6–12 months to commission LCA studies and publish declarations.
- Commission your own EPDs — if you are a construction-product manufacturer, your customers’ Scope 3 calculations depend on your data. Providing an EPD is the most efficient way to meet these data requests.
- Evaluate reporting software — assess ESG reporting platforms that can integrate product-level EPD data into Scope 3 calculations and ESRS-compliant reports.
- Monitor the Omnibus — track the legislative progress of the Omnibus scope changes. If the thresholds are raised as proposed, some companies may move out of CSRD scope — but value-chain data requests from in-scope customers will continue.
The Bottom Line
The Stop-the-Clock Regulation gives construction companies breathing room, but it does not change the destination. CSRD reporting is coming — with Scope 3 requirements that will make product-level environmental data essential infrastructure for the entire construction value chain.
The manufacturers and contractors who use the next two years to build EPD programmes, engage suppliers, and establish data workflows will transition smoothly into the reporting regime. Those who wait will face compressed timelines, higher costs, and competitive disadvantage in a market where sustainability transparency is rapidly becoming table stakes.
Information current as of publication date. The CSRD Omnibus scope changes are subject to the EU legislative process and may be modified before final adoption.