After lengthy discussions on the feedback received from the consultation on the draft European Sustainability Reporting Standards (ESRS), the EFRAG Sustainability Reporting Board (SRB) has made some final decisions to streamline the disclosure requirements in the standards.
The SRB decided to delete the requirement for entities to disclose the assurance provider for their reports as this information would already be provided in the assurance report itself.
Similarly, the requirement for companies to state their full compliance with the standards was deemed to be unnecessary as the CSRD has already mandated compliance. The board decided to replace it with a declaration that entity-specific disclosures meet qualitative standards.
They also decided to delete the taxonomy reference in ESRS 2 (General, strategy, governance and materiality) as it is already in ESRS 1 (General Principles) and would be redundant in the second standards.
Disclosure principles will remain in ESRS 1 and will be references ESRS 2 but the board decided that the text should be streamlined as much as possible.
The SRB debated the inclusion of the term value creation and its compatibleness with CSRD.
Tom Dodd, head of sustainability reporting at the European Commission, said that the standards must be directly derived from the CSRD and that the directive does not mention value creation as the Commission doesn't see a significant difference between the term and business model.
The Technical Expert Group will redraft the disclosure requirement to use the term business model instead.
The board will reconvene on 25 October to continue discussions on amending the draft ESRS in response to the exposure draft feedback.