The CSRD and ESRS was officially adopted(Link: Commission adoption) by the European Commission on July 31, 2023, and it remains essentially intact from the June update, with the addition of phase-in provisions and several previously required disclosure requirements becoming optional. For all companies’ mandated reporting, only the ESRS 2 general standards are still in effect.

Read here for the June update.

You can get a CSRD/ESRS Guidebook, which is for preparation from now on. Sign up here!

Next steps

The following information will be published soon by EFRAG 

  • Guidance on double materiality assessment and the value chain 
  • ESRS data points table  

In August, EFRAG will also hold a consultation on interoperability with IFRS and will publish a specific mapping table.  

Read more about IFRS/ISSB and ESRS interoperability here.

Listed and unlisted SMEs in Europe

The following standards will apply to both listed and unlisted SMEs in Europe following the adoption of this first set of ESRS. 

First off, listed SMEs will not be required to disclose until the financial year 2026, with a subsequent two-year opt-out period being an option (learn more about this here). A less stringent standard than this first full set of ESRS is being developed by EFRAG for listed SMEs.

Even if they are not covered by the CSRD, some non-listed SMEs may nonetheless get demands for sustainability information from clients, investors, and other stakeholders. Therefore, EFRAG has also created more straightforward voluntary standards for usage by SMEs who are not listed.

Although the interpretation of the Delegated Act and specific data points will be published in the coming months, we recommend that companies begin to compare the content of the published ESRS with your current disclosure data in order to get ready for a double materiality assessment.  

We will keep to further developments in the ESRS. Stay tuned!

Photo by Giammarco Boscaro on Unsplash