Sustainability reporting narrowed to 1,000-staff giants from 2027

Companies, auditors and independent assurance providers face a narrower sustainability-reporting duty under bill L 7, tabled on 7 October 2026 by the business and competition minister. The bill implements the EU simplification directive (the Commission's first simplification package) and concentrates mandatory reporting on the very largest companies.

Only large companies exceeding, in two consecutive financial years at balance-sheet date, both a net turnover of DKK 3,530 million and an average of 1,000 full-time employees during the year must include sustainability reporting in the management report (§ 99 a(1))Retsinformation. A company exits the duty when, in two consecutive years, it no longer exceeds either the turnover or the headcount limb.Retsinformation The label bæredygtighedsrapportering is reserved for reporting under § 99 a. The explanatory notes quantify the scope cut at roughly 90 per cent, with total annual burden relief of about DKK 3.8 billion from the directive's implementation.

Smaller undertakings get a value-chain shield (new § 99 b)Retsinformation: a protected company — one not exceeding an average of 1,000 full-time employees in the prior yearRetsinformation — may refuse a reporting company's request for information beyond the voluntary standardRetsinformation, and reporting companies may not require such information in contractsRetsinformation; offending clauses are non-bindingRetsinformation without affecting the rest of the contract. Where value-chain information is unavailable, the reporter explains the efforts made, the reasons and the planned remedy, but only for its first three reporting years (§ 99 c).

Subsidiaries are relieved where the parent reports at group level: an EU/EEA subsidiary omits § 99 a(2)-(7) disclosures where the parent covers them in its consolidated management report, naming the parent and linking the report (§ 99 d); a non-EU/EEA subsidiary does the same where the parent's report follows the § 99 a(7) standard or an equivalent one (§ 99 e). A transitional § 7 lets a non-EU/EEA subsidiary defer until 6 January 2030 where another EU/EEA group company with the largest EU turnover reports for all covered EU subsidiaries. Investment holding companies whose subsidiaries have independent business models and activities are carved out, as are their subsidiaries and branches, and commercial foundations (§ 111(2)-(3)) and acquiring or divesting parents get targeted relief.

National add-ons go: the Danish CSR statement (redegørelse for samfundsansvar) and the data-ethics statement are repealed for all companies from financial year 2026Retsinformation, with large companies outside § 99 a instead giving non-financial disclosures where needed to understand the business (§ 99(4)), and the SME reporting standard § 107 e is repealed. The act also amends lov om uafhængige erklæringsudbydere, selskabsloven and revisorloven as consequentials.

The act enters into force on 1 January 2027Retsinformation with effect for financial years beginning 1 January 2027 or laterRetsinformation; the repeals of the CSR and data-ethics duties and related consequentials apply from financial year 2026, third-country subsidiary and branch rules from 2028, and companies may early-apply most provisions. Firms already reporting but falling outside the new scope were exempted for 2025-2026 by bekendtgørelse nr. 328 of 24 February 2026. Legal basis: Forslag til lov om ændring af årsregnskabsloven, lov om uafhængige erklæringsudbydere vedrørende bæredygtighedsrapportering, selskabsloven og revisorloven (L 7).