On 31 July 2025, the European Financial Reporting Advisory Group (EFRAG) published updated drafts of the European Sustainability Reporting Standards (ESRS) to make sustainability reporting easier as part of the EU’s Green Deal.
The revised ESRS Exposure Drafts reduce mandatory datapoints by 57 %, streamlining reporting and lessening the burden on companies. They also introduce a more focused Double Materiality Assessment (DMA) and improve clarity by removing overlaps and non-mandatory requirements.
We examine what the reduction in data requirements means for companies and outline recommended actions for both wave 1 and wave 2 companies as they prepare for future CSRD reporting in a changing regulatory environment.
The Most Important in 30 Seconds
- The ESRS update reduces reporting details but keeps most complex requirements, so the overall workload remains high.
- Companies have more flexibility and clearer guidance but still need to use careful judgment in disclosures.
- Staying proactive and reviewing the new standards is essential to ensure compliance and effective sustainability reporting.
Your expert for questions
Nicolette Behncke
Partner, Sustainability Reporting Leader Europe at PwC Germany
Tel: +49 171 7640 004
Email
Revised ESRS: Practical Simplifications Without Fundamental Change
Although the revised European Sustainability Reporting Standards (ESRS) propose cutting 57% of mandatory and 68% of total datapoints, our experience shows this does not lead to an equally large reduction in reporting effort for companies. Many of the deleted datapoints were voluntary or qualitative, which often required less work. Most of the demanding quantitative datapoints remain, and some disclosures have simply been moved rather than removed. As a result, companies will only see a modest decrease in workload and need to carefully assess how these changes affect their own reporting requirements.
Streamlined Structure: Less Detail, Same Need for Precision
In practice, the Double Materiality Assessment (DMA) has become somewhat simpler due to new guidance and reliefs, such as clearer instructions on assessing gross versus net impacts and the option for a top-down approach that requires less documentation. However, these changes do not significantly reduce the overall effort needed to perform the DMA itself. Companies benefit from needing less documentation, especially if they have already completed a DMA, but the core assessment process remains demanding. The removal of the sub-sub-topic level streamlines the process but also reduces detail, meaning companies must still ensure their sustainability impacts, risks, and opportunities are precise enough to identify relevant datapoints and set effective policies and targets.
The amended ESRS Exposure Drafts expand the concept of information materiality, allowing companies to apply it not only to specific topical disclosures but also to general disclosures in ESRS 2. There are also new clarifications on how disclosures can be aggregated or broken down. However, applying information materiality in practice may be challenging. For instance, it is unclear whether companies can now omit disclosures about their policies, actions, or targets for a material topic and still claim their sustainability statement is presented fairly.
Viewpoint “Navigating the New ESRS”
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Keeping Up with Evolving Sustainability Reporting
With the latest revisions, the ESRS are now clearer and less detailed, making them easier to read and apply. Overlaps and repeated content have been reduced, and detailed information like EU Taxonomy data can be included in dedicated sections. The definition of “own operations” now matches financial statements, improving the link between financial and sustainability reporting.
The ESRS update also introduces a “fair presentation” framework, focusing on providing a complete and accurate sustainability report rather than just meeting compliance. This shift does not reduce reporting effort or data points, as the workload still depends on material topics. While auditors are used to fair presentation in financial reporting, the CSRD does not yet fully align with this concept, which may create inconsistencies that need to be resolved.
Immediate Actions and Insights: Your Next Steps for ESRS Reporting
Companies should act now to keep pace with evolving sustainability reporting regulations – whether they are already reporting or preparing for future requirements.
Immediate steps include:
- Continuing current ESRS reporting
- Utilizing available reliefs
- Keeping stakeholders informed
Additionally, companies should review how amended ESRS clarifications may affect 2025 reporting and ensure their approach aligns with both business strategy and long-term sustainability goals. In our Viewpoint, we not only highlight immediate actions, but also provide medium- and long-term recommendations. Download the full Viewpoint to discover practical steps for every phase of your sustainability journey!
Discover what’s changing in ESRS reporting
Our latest Viewpoint breaks down the new EFRAG draft standards, which significantly reduce mandatory data points and simplify sustainability reporting for companies. Learn what these changes mean for your business and get actionable recommendations for both wave 1 and wave 2 CSRD reporters.
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