The European Financial Reporting Advisory Group (EFRAG) has published the eagerly awaited draft simplified European Sustainability Reporting Standards (ESRS), along with its technical advice to the European Commission. In its press release, EFRAG have highlighted many of the simplifications implemented which it hopes will help reporting companies integrate sustainability reporting into their business. The simplifications which EFRAG have noted include:
- Standards which are “shorter, clearer, easier to understand and to implement”
- A 61% reduction of datapoints that are required if material
- Deletion of all voluntary disclosures
- Substantial reliefs, proportionality mechanisms and ad hoc phasing-in for challenging disclosures
- Principles based standards for narrative disclosures
- An emphasis on fair presentation
- A simplified materiality assessment
- Measures to reduce pressure in relation to data collection in the value chain
- Enhanced interoperability with the ISSB standards, with common disclosures preserved where possible
The European Commission will now prepare a Delegated Act to revise the first set of ESRS’s based on EFRAG’s technical advice.
Also, on 4 December EFRAG launched the ESRS Knowledge Hub, an interactive online platform designed to support companies, practitioners and stakeholders in navigating the European Sustainability Reporting Standards (ESRS) and broader sustainability reporting materials developed by EFRAG. First time users can click the link to go to the landing page and register to log -in.
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