Thanks to the gradual weakening of the Hays Code (which was abandoned entirely by 1968) as well as Hitchcock's sheer popularity by this point, the director was able to remove that final scene despite the Production Code Administration's wishes.

Source: https://www.slashfilm.com/1461688/how-hays-code-almost-ruined-ending-alfred-hitchcocks-vertigo/

The office enforced the Hays Code strictly, with one slight tweak where Breen stated that sin could be shown in movies, but there had to be a consequence to it.

Source: https://collider.com/hays-code-hollywood-history/

While the Hays Code made queerbaiting more prominent throughout classic cinema by virtue of making queer conduct completely taboo, Feig flips the script, treating Emily's queerness as canonical and queer behavior as sacrosanct.

Source: https://www.slashfilm.com/1203666/the-daily-stream-a-simple-favor-is-a-complicated-decadent-mystery/