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The European Sustainability Reporting Standards (ESRS) are the mandatory reporting standards under the CSRD. How they are structured, what must be disclosed, and how double materiality determines reporting scope – explained concisely.
Mandatory EU reporting standards that specify how companies must report on sustainability under the CSRD.
EFRAG (European Financial Reporting Advisory Group) develops the ESRS; the European Commission adopts them as delegated acts.
2 cross-cutting standards (ESRS 1 and ESRS 2) + 10 topical standards covering environment, social and governance.
The double materiality assessment determines which topics and data points must be reported – not all data points are mandatory for every company.
The European Sustainability Reporting Standards (ESRS) are the mandatory reporting standards that operationalize the CSRD. They were developed by EFRAG and adopted by the European Commission as delegated acts. The ESRS specify which sustainability topics companies must report on, what disclosures are required, and how those disclosures must be structured. They form the substantive backbone of CSRD reporting.
The ESRS are divided into two cross-cutting standards that apply to all companies, and ten topical standards whose application depends on the double materiality assessment. ESRS 1 sets out general requirements for presentation and quality; ESRS 2 prescribes general disclosures on governance, strategy, impacts, risks and opportunities, and management actions. For the topical standards, the materiality principle applies: companies only report on topics that are material to them.
The topical standards cover the full ESG spectrum and follow the CSRD's systematic structure. Each standard contains required and recommended disclosures; which of these must be reported is determined by the materiality assessment.
The ESRS contain several hundred data points, but no company is required to report all of them. The starting point is the double materiality assessment, which evaluates both impact materiality and financial materiality (risks and opportunities). Only for topics identified as material do the corresponding data points become mandatory. Some data points are classified as mandatory regardless of materiality and must always be disclosed.
With the Omnibus package, the European Commission has proposed streamlining ESRS requirements: the number of mandatory data points decreases significantly, voluntary disclosures are reduced, and the reporting burden for smaller in-scope companies diminishes. The substantive structure of the ESRS is preserved – companies should advance their preparations based on the current regulatory framework and make targeted use of the reduced scope.
Structured implementation of the ESRS begins with the materiality assessment and then works through the relevant standards topic by topic.
The CSRD is the EU directive that creates the reporting obligation (the 'whether' and 'who'). The ESRS are the concrete standards that specify what and how to report (the 'what' and 'how'). Without the ESRS the CSRD has no substantive content – the standards fill the directive with concrete requirements.
The first set of ESRS contains several hundred data points. Not all are mandatory: which disclosures are required depends on the outcome of the double materiality assessment. The EU Omnibus package is expected to significantly reduce the number of compulsorily required data points.
ESRS 2 is the cross-cutting standard for general disclosures: it requires disclosures on governance, strategy, stakeholder engagement, impacts, risks and opportunities (IROs), and management actions. ESRS 2 applies to all reporting companies regardless of materiality and provides the structural framework for the entire sustainability report.
Yes, sector-specific ESRS are planned and will supplement industry-specific requirements. Their publication has been postponed, however; at present only the twelve cross-sector standards apply.
The ESRS and GRI (Global Reporting Initiative) standards pursue similar goals but are distinct frameworks. EFRAG and GRI have produced an interoperability mapping that shows which GRI disclosures correspond to ESRS data points. Companies already reporting under GRI can leverage these overlaps but must still fully comply with the ESRS framework.
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