Avoiding a missed opportunity: civil society will only support ambitious ESRS

Prior to the publication of the delegated act on the future European Sustainability Reporting Standards (ESRS), the Economy fort he Common Good (ECG) co-signed a joint letter with other civil society organisations to avoid lowering the scope even further. ESRS are a milestone in corporate reporting towards more consistent and comparable sustainability disclosures. The European Financial Reporting Advisory Group (EFRAG), of which ECG is a member, offers technical advice to the European Commission and provides a sound, holistic and coherent framework to achieve this objective. It was adopted without dissent by the EFRAG Sustainability Reporting Board, following an extensive multistakeholder process that drew on the expertise of all stakeholders.

Some organisations are now calling on the Commission to reduce the scope of the standards. We believe this would be a mistake since any further reduction in the scope, content or coverage of the ESRS would undermine the credibility of the process, the support of civil society and the development of sector-specific standards. The compromise reached by EFRAG after lengthy and sometimes difficult discussions represents a careful balance between different views and stakeholder interests.

We therefore urge the Commission to follow EFRAG’s technical advice alongside 60+ companies and investors worth 651bn USD, and we caution against making
significant changes at this stage, as this would risk discrediting the process so far and undoing a good compromise. Worse still, it would result in a missed opportunity for sustainability goals and undermine the development of the EU regulatory framework for sustainable finance. In this spirit, we would like to state that:

  • The consensus reached by EFRAG is the right one
  • The ESRS must follow the mandate of the CSRD
  • ESRS are proportionate
  • European supervisors support EFRAG’s technical advice

Read full letter.