On June 25, the Swiss Federal Council voted to pause revision of corporate climate disclosures requirements. The revision was intended as a comparative study to align Swiss law with international sustainability reporting standards. However, turmoil in the European Union over the future of sustainability reporting directives caused the Federal Council to pause the project. Although not a member of the EU, Switzerland clearly intends to follow their lead on the direction the country should take.
Published in November 2022, the Ordinance on Climate Disclosures establishing a national reporting requirement for “public companies, banks and insurance companies with 500 or more employees and at least CHF 20 million in total assets or more than CHF 40 million in turnover.” The Ordinance went into force on January 1, 2024.
On December 6, 2024, the Federal Council “proposed that the ordinance be aligned with the latest international developments on standardised reporting, and that minimum requirements on roadmaps for financial sector companies be defined.”
The Federal Council initiated a consultation period from December to March, allowing for interested parties to provide feedback on proposed changes. Changes were anticipated to be announced in mid-2025. However, the development has been paused while the EU debates the future of sustainability reporting.
The EU was an early adopted of sustainability disclosures, requiring nearly all companies with over 250 employees to file annual reports in a phased in approach. However, the 2024 EU Parliament elections shifted the composure of the body to the right and brought with it an anti-green sentiment. In early 2025, the European Commission proposed a series of directives to significantly reduce the impact of the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive.
While the proposals included a variety of changes, most focus has been on the thresholds used to determine if a company is required to report. Under the original CSRD, companies with two of the following three were required to report: 250 employees, €50 million in annual net turnover, or €25 million in assets.
The Commission proposal raises the threshold to 1000 employees, plus one of the other two options. The Council proposal raises the threshold to 1000 employees, plus €450 million in annual turnover. The Parliament is still in the early stages of debating their position, but an initial draft proposed by the project rapporteur raises the threshold to 3000 employees, plus €450 million in annual turnover.
The Parliament is expected to adopt their final proposal on October 13. The three EU bodies will then enter into negotiations, with an anticipated completion by December or January 2026.
These developments in the EU impacted the consultation phase of the Swiss Government. The release noted that proposals to align Swiss requirements with international developments “were largely welcomed during the consultation. However, there were broad calls for the implementation of the ordinance to be paused until the Federal Council had approved the ongoing revision of the overarching legislation on sustainability reporting in the Code of Obligations.”
As a result, the Federal Council has delayed the project until the EU announces their changes to sustainability reporting in early 2026. “For this reason, the Federal Council has decided to also pause the project on companies’ climate disclosures until it has approved the bill to amend the Code of Obligations, but at the latest by 1 January 2027.”