EFRAG publishes draft simplified European Sustainability Reporting Standards
On 3 December 2025, the European Financial Reporting Advisory Group (“EFRAG”) – an advisory body to the European Commission (“EC”) – published draft revised European Sustainability Reporting Standards (“ESRS”).
The draft revised ESRS propose significant departures from the current ESRS, including:
- reducing required datapoints (when material) by 61% and removing all voluntary disclosures;
- removing the preference for direct data, thereby reducing data collection burden in respect of in-scope entities’ value chains;
- introducing proportionality mechanisms and targeted transition periods for certain disclosures;
- introducing more principles-based narrative reporting, with more flexibility in presentation parameters; and
- improving interoperability with the ISSB.
We discuss the differences between the current and draft revised ESRS in more detail in this update.
Background
EU and non-EU entities currently subject to the EU Corporate Sustainability Reporting Directive (“CSRD“) are required to report against the ESRS, which were drafted by EFRAG and adopted by the EC through Commission Delegated Regulation (EU) 2023/2772 in July 2023. However, the ESRS have been widely criticised for (among other things) having too many datapoints and lacking sufficient clarity. Therefore, as part of the EU’s Omnibus proposals (which you can read more about here), in March 2025, the EC requested that EFRAG simplify the ESRS.
In July 2025, EFRAG published revised exposure drafts of the ESRS, which were open for consultation until September 2025. Following its review of responses received to the consultation, EFRAG has now published its final draft revised ESRS.
Comparison of the current and draft revised ESRS
The draft revised ESRS do not propose deviating from the fundamental structure of the current ESRS, i.e. two cross-cutting standards (ESRS 1 and ESRS 2) that provide general reporting concepts and overarching disclosure requirements, alongside ten topical standards with specific disclosure requirements for ESG matters.
However, EFRAG has proposed a number of significant changes to the current ESRS, including (but not limited to):
| Standard | Proposed changes |
|---|---|
| ESRS 1 (General Requirements) |
|
| ESRS 2 (General Disclosures) |
|
| E1 (Climate Change) |
|
| E2 (Pollution) |
|
| E3 (Water) |
|
| E4 (Biodiversity & Ecosystems) |
|
| E5 (Resource Use & Circular Economy) |
|
| S1-S4 (Own Workforce; Workers in the Value Chain; Affected Communities; and Consumers and End-Users) |
|
| S1 (Own Workforce) |
|
| G1 (Business Conduct) |
|
Next steps
The EC will now consider EFRAG’s draft revised ESRS when preparing its delegated act to formally revise the ESRS. The EC is aiming to adopt this delegated act in late 2026, applying to in-scope entities in respect of financial year 2027. Until then, in-scope entities are required to continue to report against the existing ESRS.
