Revised ESRS and voluntary sustainability reporting standards become final

The revised European Sustainability Reporting Standards ("ESRS") and the voluntary sustainability reporting standard have now cleared the final stage of the EU legislative process.

Following their adoption by the European Commission on 3 July 2026, both delegated acts were subject to a two-month scrutiny period by the European Parliament and the Council of the European Union. The scrutiny period has now expired without objection, meaning the texts are final. Texts can be accessed here.

Background

Companies within the scope of the Corporate Sustainability Reporting Directive ("CSRD") are required to report in accordance with the ESRS. The revised standards were adopted as part of the EU's sustainability reporting simplification agenda and substantially reduce the volume of required disclosures (more information in our previous blogpost). According to the European Commission, the revised ESRS reduce mandatory datapoints by more than 60% and total datapoints by more than 70%, while preserving key concepts such as double materiality. The Commission also expects the changes to reduce reporting costs by more than 30% per company.

Alongside the revised ESRS, the Commission adopted a voluntary sustainability reporting standard for companies outside the scope of the CSRD. The voluntary standard is designed to provide a proportionate reporting framework and also serves as the basis for the CSRD "value chain cap", limiting the sustainability information that in-scope companies may request from smaller entities within their value chains.

Next steps

The revised ESRS and the voluntary sustainability reporting standard are now expected to be published in the Official Journal of the European Union. The standards will apply to financial years beginning on or after 1 January 2027, with the first sustainability reports under the revised regime due in 2028.

In parallel, EFRAG has published an updated list of ESRS datapoints reflecting the final revised standards adopted by the Commission. The updated datapoint list replaces the previous version and follows the same methodology used in EFRAG's Implementation Guidance 3 (IG 3). EFRAG has invited stakeholders to identify any fatal flaws in the datapoint list by 23 October 2026, with a final version expected before the end of 2026. EFRAG has also announced that a draft XBRL taxonomy for the revised ESRS, which will support machine-readable sustainability reporting, will be published for consultation in the coming weeks.

EFRAG is also continuing its work on sustainability reporting standards for certain non-EU groups. On 23 July 2026, EFRAG launched a public consultation on its exposure draft European Sustainability Reporting Standards for Certain Non-EU Undertakings in accordance with Article 40a of the Accounting Directive ("ESRS-40a"). The draft standards are relevant for non-EU groups falling within the extraterritorial scope of the CSRD and would require certain EU subsidiaries and branches to publish sustainability information at the level of their ultimate non-EU parent group. The consultation remains open until 31 October 2026, with EFRAG currently expecting to submit its final technical advice to the European Commission in January 2027. Adoption of the final ESRS-40a standards is anticipated during 2027, with the first reports expected to be published in 2029 in respect of financial years starting on or after 1 January 2028.

Key takeaway: the revised ESRS framework is now settled from a legislative perspective and companies can begin preparing for implementation using EFRAG's updated datapoint list, ahead of mandatory application from 2027. At the same time, non-EU groups with significant EU operations should continue to monitor developments relating to ESRS-40a, which will determine the sustainability reporting obligations applicable to certain third-country parent groups from 2029 onwards.