What is ESRS?

The ESRS (European Sustainability Reporting Standards) is the sustainability reporting framework of the European Union. The standards define which ESG and sustainability-related information companies are required to disclose under the provisions of the CSRD (Corporate Sustainability Reporting Directive).

The objective of ESRS is to create a more consistent and comparable sustainability reporting practice across the European Union. The framework was developed by EFRAG and adopted by the European Commission in the form of delegated regulations.

What does ESRS regulate?

The standards contain detailed disclosure requirements related to environmental, social and governance topics. These include, among others:

• the presentation of climate-related risks and targets,
• reporting on energy consumption and emissions data,
• workforce-related information,
• risks related to human rights and the value chain,
• as well as business ethics and corporate governance practices.

One of the central elements of ESRS is the principle of double materiality. Companies are required to assess both the financial impacts sustainability matters may have on their operations and the environmental and social impacts of their activities.

Why is ESRS important?

Sustainability reporting is playing an increasingly important role in investment, financing and regulatory decisions. ESRS provides a uniform framework for disclosures, making sustainability information easier to compare and evaluate.

The application of the standards also requires practical preparation from companies. Reporting often involves the introduction of new data collection processes, internal controls and ESG risk management approaches. In several areas, assurance requirements providing external verification are also emerging.

During 2025–2026, the European Union also published simplification proposals related to the CSRD and ESRS framework. The objective is to reduce administrative burdens and clarify the scope of application, therefore the regulation continues to evolve.

Frequently asked questions

What is the relationship between ESRS and CSRD?

The CSRD establishes the obligation for sustainability reporting, while ESRS defines the structure and content requirements of the reports.

Which companies are subject to ESRS?

ESRS primarily applies to larger companies and certain listed entities. The scope of affected companies and the implementation timeline may still change due to ongoing EU simplification packages.

What does double materiality mean?

Companies must assess both the business impacts of sustainability matters and the impacts their own operations have on the environment and society.

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