DECISION BRIEF
What the rule requires
Sustainability reporting under the EU Accounting Directive, introduced by the CSRD, was substantially narrowed by Directive (EU) 2026/470, published in the Official Journal on 26 February 2026. Reporting now applies to undertakings exceeding EUR 450,000,000 net turnover AND more than 1,000 employees on average, consolidated for parents, for financial years starting on or after 1 January 2027.
Wave-one reporting under Article 5(2)(a) of Directive (EU) 2022/2464 is limited to financial years starting between 1 January 2024 and 31 December 2026, and member states may exempt newly out-of-scope undertakings for financial years starting between 1 January 2025 and 31 December 2026. Member states transpose Articles 1 to 3 by 19 March 2027.
Who is affected, and from when
Built for: Turkish groups with EU subsidiaries or branches, exporters receiving ESG questionnaires from EU customers, and the teams deciding how much of one to answer.
A Turkish (third-country) group is reached through Article 40a. Where the group generates net turnover in the Union above EUR 450,000,000, its EU subsidiary — or, absent one, its EU branch — with net turnover above EUR 200,000,000 must publish the group sustainability report. Both tests have to be met: EU-wide group turnover, and a large enough EU entity to carry the filing.
Most Turkish companies are not in scope at all. They are reached as suppliers, through questionnaires from EU customers who are. That is a commercial relationship, not a legal obligation — and it now has a limit.
The value-chain cap is the practical protection: undertakings in the value chain with 1,000 or fewer average employees may decline information requests that exceed the standards issued for voluntary use.
What to do next
- Measure group net turnover generated in the Union, not just the revenue of the EU subsidiary. The Article 40a test is a group test.
- Check whether any single EU subsidiary or branch clears EUR 200,000,000 net turnover — that is the entity that would have to publish.
- If you are a supplier under 1,000 employees, learn the value-chain cap and use it. Answering everything you are sent is a cost with no compliance benefit.
- Do not rebuild TSRS work for CSRD or the reverse. Establish one disclosure spine and map it to both — see the TSRS hub.
Coverage boundary
Net Zero tracks CSRD as it reaches Turkish companies. This is not a guide to preparing an ESRS report for an EU-domiciled undertaking, and it does not cover the SFDR.