04 Aug European Sustainability Reporting Standards (ESRS): An overview
La Comisión Europea está adoptando las Normas Europeas de Información sobre Sostenibilidad (“ESRS”, por sus siglas en inglés) para mejorar la calidad de los informes de sostenibilidad de las empresas. Las ESRS serán obligatorias para las empresas que deban informar sobre sostenibilidad en virtud de la Directiva contable, modificada por la Directiva sobre informes de sostenibilidad de las empresas (CSRD) en 2022. Las normas se basan en el asesoramiento técnico del EFRAG, un organismo consultivo independiente, y su objetivo es reducir los costes de la información y mejorar la responsabilidad pública.
What companies should communicate
The ESRS require companies to report on their impact on people and the environment, as well as how social and environmental issues create financial risks and opportunities for the company. The ESRS are 12 in number and cover a range of sustainability issues, including climate, pollution, water and marine resources, biodiversity and ecosystems, resource use and the circular economy, own workforce, workers in the value chain, affected communities, consumers and end users, and business conduct.
ESRS 1 sets out the general principles for reporting, while ESRS 2 specifies the essential information to be disclosed. All other reporting standards and requirements are subject to a materiality assessment, which means that companies only report relevant information. Disclosure requirements subject to materiality are not voluntary and must be disclosed if material. Companies must conduct a robust materiality assessment and provide a detailed explanation if they conclude that a topic is not material.
Consistency with other EU legislation
The materiality approach in the ESRS aims to ensure consistency with other EU legislation on sustainable finance, such as the Sustainable Financial Disclosure Regulation (SFDR), the Benchmarks Regulation (BMR) and the Capital Requirements Regulation (CRR). The ESRS contain data points that correspond to the specific information needed by financial market participants, benchmark administrators and financial institutions for their own reporting purposes under these regulations.
Si una empresa llega a la conclusión de que un dato no es importante, debe declarar explícitamente que “no es importante” y proporcionar una tabla que indique dónde se pueden encontrar los datos en su declaración de sostenibilidad. Estas disposiciones tienen por objeto facilitar el cumplimiento de las obligaciones de divulgación previstas en el SFDR, el BMR y el CRR. Se proporcionarán más aclaraciones en los marcos respectivos sobre el enfoque que debe adoptarse cuando una empresa haya evaluado un dato como no material.
What about SMEs?
The Accounting Directive, as amended by the CSRD, does not impose new reporting requirements on SMEs, except for listed SMEs. Listed SMEs are not required to report sustainability information until 2026 and may do so under separate, proportionate standards, which are less demanding than the full set of ESRSs. EFRAG is currently developing draft versions of these proportionate standards for listed SMEs.
EFRAG is also developing simpler voluntary standards for unlisted SMEs to enable them to respond to requests for sustainability information in an efficient and proportionate manner. The rules for listed SMEs will legally limit the information that ESRSs can require large companies to obtain from SMEs in their value chains, providing further safeguards against disproportionate filtering effects on reporting requirements for SMEs in the value chains of larger companies.
Alignment with global standards
The European Commission has worked to ensure a high level of alignment between the European Sustainability Reporting Standards (ESRS) and the standards of the International Sustainability Standards Board (ISSB) and the Global Reporting Initiative (GRI). Many of the reporting requirements in ESRS were inspired by the GRI standards, and intensive discussions between the Commission, EFRAG, and the ISSB have ensured a high degree of alignment where the two sets of standards overlap.
Companies reporting in accordance with ESRS on climate change will largely report the same information as companies using the ISSB standard on climate-related disclosures. The EU goes further than any other major jurisdiction in integrating ISSB standards into its own legal framework, making a major contribution towards a coherent global framework and global comparability of reported sustainability information. At the same time, ESRS are consistent with the EU's own political ambitions with regard to sustainable finance and the European Green Deal, covering a full range of environmental, social, and governance issues.
Application calendar
The ESRS delegated act adopted by the Commission will be transmitted to the European Parliament and the Council for review in the second half of August. The review period will last two months, extendable for a further two months.
Companies will have to start reporting under the ESRS according to a timetable:
- Large listed companies, large banks and large insurance companies with more than 500 employees will start in the financial year 2024.
- Other large companies will start in the financial year 2025.
- Listed SMEs will start in the financial year 2026. Listed SMEs will be able to opt out of the reporting requirements for an additional two years.
Non-EU companies that generate more than EUR 150 million per year in the EU and have a branch or subsidiary in the EU will be required to report on sustainability impact at group level from the 2028 financial year. Separate rules will be adopted specifically for this case.
In conclusion, the adoption of ESRS represents an important step towards improving corporate sustainability reporting, aligning with global standards and establishing a clear timeline for implementation.