The European Financial Reporting Advisory Group (EFRAG) has just released its progress report on the much-anticipated revision of European Sustainability Reporting Standards (ESRS). With a 50%+ reduction in mandatory datapoints on the horizon, this represents the biggest shift in EU sustainability reporting since CSRD implementation.
Burden Reduction Through Smart Design
EFRAG is activating six key simplification levers, with the most impactful being the overhaul of Double Materiality Assessment (DMA) procedures. Companies struggled with disproportionate effort for modest outcomes, treating DMA as a compliance checklist rather than strategic tool. The revision emphasizes business model-driven approaches and reasonable evidence thresholds.
Structural Improvements for Better Reporting
The relationship between Minimum Disclosure Requirements and topical specifications is being fundamentally restructured. This addresses the complexity and duplication that made first-year reporting so challenging. Companies will gain flexibility in presentation, including executive summaries and appendices for granular data.
Enhanced Global Alignment
Interoperability with ISSB standards is being strengthened, particularly around GHG emission boundaries and common language. This reduces the dual-reporting burden many multinational companies face and supports the global convergence of sustainability reporting frameworks.
Ready for Change?
With exposure drafts expected in July and final standards by October 2025, companies need to prepare for this transition. The window for stakeholder input is brief but critical. Partner with Ksapa to navigate the ESRS revision successfully. Our sustainability reporting experts help you optimize your approach, reduce compliance burden, and maintain high-quality disclosures. Contact us today.
Image by Freepik
Author of several books and resources on business, sustainability and responsibility. Working with top decision makers pursuing transformational changes for their organizations, leaders and industries. Working with executives improving resilience and competitiveness of their company and products given their climate and human right business agendas. Connect with Farid Baddache on Twitter at @Fbaddache.
