Eurosif has responded to EFRAG’s consultation on simplifying the European Sustainability Reporting Standards (ESRS), endorsing the proposed direction as a workable balance between streamlining and investors’ information needs. It points to the removal of duplications and clearer key concepts as improvements to usability, while cautioning that additional reductions beyond the reported 57% cut in data points could materially limit decision-useful disclosures. The statement flags particular risks in proposals that would make disclosures on anticipated financial effects voluntary, arguing this would create data gaps and weaken investors’ ability to assess financial materiality. Eurosif also raises concerns about cross-cutting reliefs based on “undue cost and effort” without adequate safeguards, reduced alignment with the International Sustainability Standards Board (ISSB) baseline through deleted data points and divergent reliefs, and any weakening of climate and biodiversity reporting, including climate transition plans, climate scenarios and biodiversity targets. It further notes implications for investors’ Sustainable Finance Disclosure Regulation (SFDR) principal adverse impact reporting where data points are removed, including a dedicated indicator on cases of non-respect of human rights principles, and questions the removal of disclosures on lobbying activities as relevant business-conduct information.
Eurosif 2025-09-29
Eurosif supports EFRAG’s ESRS simplification approach but warns against further cuts that could reduce investor-relevant disclosures
Eurosif responded to the European Financial Reporting Advisory Group's consultation on simplifying the European Sustainability Reporting Standards, supporting the balance between streamlining and meeting investors' needs. Eurosif warns that further reductions beyond the 57% cut in data points could limit useful disclosures and highlights risks in making anticipated financial effects disclosures voluntary, raising concerns about reduced alignment with the International Sustainability Standards Board and potential weakening of climate and biodiversity reporting, as well as implications for Sustainable Finance Disclosure Regulation reporting.