The European Commission has opened a consultation process for the European Sustainability Reporting Standards (ESRS) to incorporate valuable feedback before fully finalising the standard.
The ESRS standards are an integral component of the EU’s Corporate Sustainability Reporting Directive (CSRD) – a mandatory regulation applicable to large companies operating within or connected to the EU.
The standards will have a significant impact on the manner in which companies report their sustainability performance, encompassing various aspects such as environmental factors, social issues, governance, and economic performance. Notably, companies will be required to report on ‘double materiality’ as part of their sustainability reporting responsibilities.
Although the ESRS standards are primarily based on the established Global Reporting Initiative (GRI) standards, they do have differences.
Eelco van der Enden, CEO of GRI, stated, “The release of the ESRS for consultation marks a pivotal moment in the realisation of the CSRD’s aspirations to significantly expand mandatory sustainability reporting among companies operating within the EU.
“What this means is that complying with ESRS impact reporting requirements will be much easier for those companies that already use GRI, and they can then focus on adding financially material information and possible ESRS specific disclosures.”
Earlier this year, the Directorate-General for Financial Stability, Financial Services, and Capital Markets Union (DG-FISMA) proposed several enhancements to the ESRS. This included the need for more specific reporting obligations, improved alignment with other reporting frameworks, and clearer guidance on the measurement and reporting of sustainability risks.
Interested stakeholders and industry experts now have the opportunity to provide feedback on the draft standards until July 7. The input received during this consultation period will be considered when finalising the initiative.
The launch of this consultation period suggests that the ESRS are well on track to be made available for implementation by companies starting from 2024.
We are sorry that this post was not useful for you!
Let us improve this post!
Tell us how we can improve this post?