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ESRS update: EFRAG proposes simplified standards following Omnibus initiative Background
In December 2025, EFRAG submitted its technical advice to the European Commission on the revision of the European Sustainability Reporting Standards (ESRS). This work follows the Commission’s Omnibus Simplification initiative, launched to reduce the reporting burden under the Corporate Sustainability Reporting Directive (CSRD).
Mandatory datapoints reduced by around 60%
The proposed revised ESRS significantly reduce the number of mandatory datapoints compared to the standards adopted in 2023. According to EFRAG, the reduction is around 60%, with materiality confirmed as the main filter for disclosures. The double materiality assessment is simplified and allows a more pragmatic, top-down approach.
Clearer structure and practical reliefs
The revision focuses on clearer wording, shorter narratives and the removal of overlaps between general and topical standards. Several burden-reduction measures are introduced, including greater flexibility in the use of estimates and more practical requirements for value-chain information. At the same time, the standards put more emphasis on fair presentation and the use of professional judgement, rather than exhaustive disclosure checklists.
Alignment with global standards
Interoperability with international frameworks is further improved, in particular through closer alignment with IFRS S1 and S2 and the Greenhouse Gas Protocol. EFRAG has stressed that the objective of the revision is to make sustainability reporting more usable and decision-relevant, without lowering its ambition.
CSRD scope and employee threshold
The revision of the ESRS is closely linked to the broader discussion on the future scope of the CSRD, including the proposed 1,000-employee threshold introduced under the Omnibus initiative. While this threshold is part of the Commission’s wider simplification proposal, it is not yet finally decided and will be confirmed through the legislative process. The revised ESRS are therefore being developed to remain applicable to the final CSRD scope once adopted.
Next steps
The European Commission is currently reviewing EFRAG’s technical advice. The revised ESRS are expected to be adopted via a delegated act by mid-2026. Subject to adoption, they would apply from financial year 2027, with an option for early application from 2026.
In our view, the EU and EFRAG initially overstepped the mark. The very high number of datapoints, combined with a massive amount of qualitative information and recommendations that cannot really be checked, turned the ESRS into an administrative monstrosity. The ambition to develop additional sector standards (despite existing frameworks such as SASB being far more advanced) was more wishful thinking than down-to-earth guidance. The revision therefore comes at the last minute. The remaining hope is that the EU has not killed the momentum for transparency on sustainability-related issues with a policy approach of ‘two steps forward and one step backward’.