European Commission publishes the draft Delegate Act on the first set of the European Sustainability Reporting Standards
Another significant milestone in the journey toward more transparent reporting on ESG information and, ultimately, towards a more sustainable economy.
The European Commission published today the draft delegated act with the first set of European Sustainability Reporting Standards (ESRS)
The delegated act is now in consultation and open until 7 July 2023.
The Commission has made significant changes to the draft standards proposed by EFRAG to ensure proportionality and ease of application.
Here are some highlights:
- All disclosure requirements and data points will be subject to materiality assessment, except for disclosure requirements in ESRS 2 “General disclosures”;
- Additional phasing-in, certain requirements added to help companies apply the ESRS effectively ( e.g undertakings with less than 750 employees may omit scope 3 GHG emissions data and the disclosure requirements specified in the standard on “own workforce” in the first year that they apply the standards and the disclosure requirements specified in the standards on biodiversity and on value-chain workers, affected communities, and consumers and end-users in the first two years that they apply the standards);
- Certain disclosure requirements become voluntary;
- Further flexibilities for specific disclosure requirements and modification of data points regarding corruption and bribery and the protection of whistle-blowers;
- Interoperability with global standard-setting initiatives: Modifications to the draft ESRS have been made in light of the increased engagement between the EU Commission, EFRAG, and the ISSB.
The standards will impact the companies reporting as of January 1, 2024.
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