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ESRS under CSRD Summary
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European Sustainability Reporting Standards (ESRS) under CSRD
Summary as of June 28, 2025 | Based on final adopted standards
Key Facts
- Effective: First reports due 2025 (covering FY2024) for large listed companies [citation:6][citation:10]
- Scope: ~50,000 EU companies + non-EU companies with significant EU operations [citation:1][citation:6]
- Standards: 12 reporting standards covering environmental, social and governance topics [citation:4][citation:10]
- Core Concept: Double materiality (financial + impact perspectives) [citation:4][citation:7]
1. ESRS Framework Structure
The ESRS consists of 12 standards organized into three categories [citation:4][citation:10]:
| Category |
Standard |
Focus Area |
| Cross-cutting |
ESRS 1 |
General Requirements |
| ESRS 2 |
General Disclosures |
| Environmental |
ESRS E1 |
Climate Change |
| ESRS E2 |
Pollution |
| ESRS E3 |
Water & Marine Resources |
| ESRS E4 |
Biodiversity & Ecosystems |
| ESRS E5 |
Circular Economy |
| Social |
ESRS S1 |
Own Workforce |
| ESRS S2 |
Workers in Value Chain |
| ESRS S3 |
Affected Communities |
| ESRS S4 |
Consumers & End-Users |
| Governance |
ESRS G1 |
Business Conduct |
2. Core Requirements
Double Materiality Assessment
Companies must evaluate both [citation:4][citation:7]:
- Impact Materiality: How the company affects people/environment
- Financial Materiality: How sustainability matters affect the company
Mandatory Disclosures
Only ESRS 2 General Disclosures are fully mandatory. Other standards apply based on materiality assessment, except [citation:7][citation:10]:
- Climate change (ESRS E1) requires explanation if deemed immaterial
- Financial institutions must disclose certain data points regardless of materiality
Value Chain Reporting
Companies must report on impacts, risks and opportunities across their entire value chain, including [citation:4][citation:10]:
- Upstream suppliers
- Downstream customers
- Investments (for financial institutions)
3. Implementation Timeline
Phased implementation based on company size and type [citation:6][citation:8]:
| Company Type |
First Report Due |
Coverage Period |
| Large listed companies |
2025 |
FY2024 |
| Other large companies |
2026 |
FY2025 |
| Listed SMEs |
2027 |
FY2026 |
| Non-EU companies |
2029 |
FY2028 |
Phase-in Reliefs
Certain disclosures can be deferred [citation:7][citation:10]:
- All companies: May omit financial effects of environmental risks for 1 year (qualitative only for 3 years)
- <750 employees: Can defer Scope 3 GHG emissions and workforce disclosures for 1 year
- <750 employees: May omit biodiversity, value chain workers, communities and consumer disclosures for 2 years
4. Reporting Format
ESRS requires [citation:4][citation:10]:
- Integration with annual financial report in a "Sustainability Statement"
- Digital tagging for machine readability (European Single Access Point)
- Assurance requirement (limited assurance initially)
Key Changes from Draft to Final Standards
- Reduced mandatory data points (now mostly materiality-dependent) [citation:7]
- Stronger alignment with TCFD framework and ISSB standards [citation:10]
- Added phase-in reliefs for smaller companies [citation:7]
- More voluntary disclosure options (e.g., biodiversity transition plans) [citation:7]
5. Interoperability with Other Frameworks
EFRAG has worked to align ESRS with [citation:3][citation:5][citation:9]:
- ISSB Standards: 85% alignment on climate disclosures (IFRS S2 ↔ ESRS E1)
- GRI Standards: Interoperability index available
- TNFD: All 14 TNFD recommended disclosures reflected in ESRS
Practical Implementation Tips
- Conduct double materiality assessment first [citation:7]
- Build data collection systems for value chain information [citation:4]
- Leverage phase-in periods strategically [citation:10]
- Use interoperability guidance for companies reporting under multiple frameworks [citation:5]
- Prepare for assurance requirements [citation:1]