Adoption of the delegated act on the first set of ESRS by the European Commission

Chapter Zero Slovenia welcomes the adoption of the Delegated Act on the first set of European Sustainability Reporting Standards (ESRS) by the European Commission on 31 July 2023.

The delegated act adopted by the Commission will be formally transmitted to the European Parliament and the Council of the EU for scrutiny in the second half of August. The scrutiny period lasts for two months and may be extended for a further two months. The European Parliament or the Council may reject the delegated act, but may not amend it. Additionally, the development of the standards also takes into account discussions with the International Sustainability Standards Board (ISSB) and the Global Reporting Initiative (GRI) to ensure interoperability between EU and global standards and to avoid unnecessary double reporting by companies.

The standards cover a wide range of ESG issues, including climate change, biodiversity and human rights. They provide investors with key information to assess the sustainability impact of the companies in which they invest.

The reporting requirements will be phased in for different companies. Once introduced, companies previously subject to the Non-Financial Reporting Directive NFRD (large listed companies, large banks and large insurance companies with more than 500 employees) will have to start reporting under the ESRS for the 2024 financial year, with the first reports to be disclosed in 2025. Other large companies will have to start reporting a year later. Small and medium-sized listed companies will have to start reporting under the ESRS in 2027.

More information on the adoption of the European Sustainability Reporting Standards is available here.

The European Commission press release is available here.