EFRAG (the European Financial Reporting Advisory Group) has released the initial draft of the European Sustainability Standards, setting out the rules that companies will need to follow in reporting ESG-related data such as sustainability-related impacts, risks, strategies, business models and performance under the EU’s Corporate Sustainable Reporting Directive (CSRD).

The deadline for all stakeholders to provide comments on the draft through the consultation survey has been set as 8 August.

The proposal for a CSRD identifies EFRAG as technical advisor to the EC providing draft European Sustainability Reporting Standards (‘ESRS’). EFRAG was requested by Commissioner McGuinness in May 2021 to put in place interim working methods in project mode to start the technical development of these draft standards immediately, in parallel to the legislative process of the CSRD.

The CSRD is expected to quadruple the number of companies required to report and will relate to both EU companies and those doing business in the EU.

The draft comes as the two other influential proposed standards have been released for comment: the International Sustainability Standards Board (ISSB), which is aiming to develop a global reporting standard for ESG reporting, released its first two draft reporting standards for public comment, and SEC Proposed Rule on Climate-Related Disclosure in the US.

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