Many large companies may be temporarily exempt from ESG Act
In response to the EU’s proposed Omnibus Directive – aimed at delaying and simplifying obligations related to the Corporate Sustainability Reporting Directive (CSRD) – the Hungarian government has announced its intention to amend Hungary’s ESG Act. The following summary outlines the key points of the draft amendment currently under public consultation.
(This summary refers exclusively to the planned amendments to Act CVIII of 2023 – the “ESG Act” – and does not cover the CSRD itself or its implementation into Hungarian accounting legislation, which are also subject to EU-level changes.)
Key takeaway:
According to current calculations, a large number of Hungarian large enterprises – potentially in the thousands and not listed on the stock exchange – who had expected to fall under the ESG Act from 2025 may now be temporarily exempt. It remains uncertain when they will be required to comply. While government communications suggest a possible two-year postponement – making ESG reporting mandatory only from 2028 – no such provision is included in the draft legislation, and no formal decree has yet been published.
If adopted, the amendment would leave only listed large corporations obligated to comply with ESG reporting requirements, while even listed SMEs would be removed from the scope of the Act.
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