On July 31, 2023, the European Sustainability Reporting Standards (ESRS) were approved.
The ESRS will be mandatory for companies that are required by the Accounting Directive to share certain sustainability information (these are listed public companies). The Accounting Directive, as amended by the CSRD in 2022, aims to ensure that companies in the EU report comparable and reliable sustainability information. Based on these two directives, ESRS is introduced.
The ESRS is based on a strategy of “double materiality”, that is, they oblige companies to report both their impact on people and the environment, and how social and environmental issues create financial risks and opportunities for the company.
There are 12 areas of the ESRS covering the full range of sustainability issues.