EU consultation on revised ESRS: Key developments and implications

On 6 May 2026, the European Commission published its draft Delegated Act revising the European Sustainability Reporting Standards (ESRS) under the CSRD. A four‑week public consultation is open until 3 June 2026, with final adoption of the ESRS expected by summer 2026.

 

Key takeaways

• ESRS consultation runs until 3 June 2026, with adoption targeted by summer 2026.
• Significant simplification maintained, with only targeted modifications to EFRAG proposals.
• No substantive alignment with ISSB standards.
• Modifications to the concept of materiality and clarification of requirements for the materiality assessment allow companies to focus on disclosing only decision-useful information.

 

Consultation and timeline

The consultation on the revised ESRS will run for four weeks, closing on 3 June 2026. This positions the Commission to meet its deadline under the amended CSRD (via Omnibus I) to adopt simplified standards within six months of the Directive’s publication. The revised ESRS will apply to financial years starting after 1 January 2027, with optional early adoption for FY2026.

 

Targeted changes and technical updates

The Commission has largely retained EFRAG’s simplification approach, focusing on reducing datapoints, clarifying the distinction between mandatory and voluntary disclosures, and introducing a new “top-down” materiality approach centered on decision-useful information, with an explicit expectation that non-material disclosures are excluded from reporting.

At the same time, companies are given greater flexibility in how they present and aggregate information, including on a geographic basis. The Commission clarifies that fair presentation requirements apply at the sustainability statement level, rather than for each specific data point.

The draft also introduces disclosure protections, allowing omission of commercially sensitive or financially prejudicial information, and confirms that estimated financial effects may be refined over time without this being treated as a reporting error.

On technical and interoperability issues, the revisions provide only limited alignment with ISSB frameworks and do not create a full interoperability or “ISSB adopter” pathway.

The amendments offer greater flexibility for GHG reporting boundaries, allowing undertakings to use either the financial or operational control approach when defining the reporting boundary.

Undertakings that report transition plans with targets that are not compatible with a 1.5ºC global warming target must be transparent about this in their disclosures.

The Commission’s proposal also:

• narrows microplastics disclosures to primary microplastics;
• strengthens alignment with the CSDDD;
• clarifies that only substantiated human rights incidents must be disclosed;
• provides reliefs for asset managers where disclosures may be irrelevant to the investments they manage; and
• introduces additional phase-in reliefs, including in relation to substances of very high concern.

 

Next steps

The Commission’s final ESRS are expected to be adopted by summer 2026, followed by the standard scrutiny period, with first application commencing for financial years starting after 1 January 2027. In parallel, EFRAG is expected to publish draft non‑EU ESRS in July 2026, with the consultation running to October 2026 and technical advice due in early 2027.

Companies in scope of CSRD should now be confirming their reporting perimeter and filing strategy, including where reports will need to be published and at what level (entity vs consolidated).

In parallel, organisations should initiate or revisit their double materiality assessments in the context of the revised ESRS approach and ensure assessments are sufficiently robust to support streamlined, decision‑useful disclosures.