The One-Minute Summary
ESRS (European Sustainability Reporting Standards) are the actual "rules" for CSRD reporting. Think of CSRD as the law that says "you must report" and ESRS as the instruction manual for "how to report."
There are 12 ESRS standards covering everything from climate change to worker rights. Most companies won't need all 12 - you only report on what's "material" (important) to your business.
ESRS Standards: The Restaurant Menu Analogy
Imagine ESRS as a restaurant menu with 12 dishes. You don't order everything - you only pick what's relevant to your appetite (business). But there are two dishes everyone must order (ESRS 1 and ESRS 2), like bread and water at a restaurant.
The 12 ESRS Standards Breakdown
Universal Standards (Everyone Must Use)
ESRS 1 - General Requirements
- The "how to report" standard
- Sets the rules for everything else
- Like the instruction manual for using the other standards
ESRS 2 - General Disclosures
- Basic company information everyone must provide
- Your business model, strategy, governance
- Like filling out your basic profile information
Environmental Standards (E)
ESRS E1 - Climate Change
- Greenhouse gas emissions (Scopes 1, 2, 3)
- Climate risks and opportunities
- Your net-zero plans
- Most companies need this one
ESRS E2 - Pollution
- Air, water, soil pollution
- Hazardous substances
- Only if you have significant pollution impacts
ESRS E3 - Water and Marine Resources
- Water consumption and discharge
- Impact on marine ecosystems
- Mainly for water-intensive industries
ESRS E4 - Biodiversity and Ecosystems
- Impact on nature and wildlife
- Land use and habitat protection
- Relevant if you have significant land use
ESRS E5 - Resource Use and Circular Economy
- Waste management and recycling
- Product lifecycle and circularity
- Important for manufacturing and retail
Social Standards (S)
ESRS S1 - Own Workforce
- Employee conditions, diversity, safety
- Training and development
- Most companies need this one
ESRS S2 - Workers in the Value Chain
- Supplier worker conditions
- Subcontractor labor practices
- Important if you have complex supply chains
ESRS S3 - Affected Communities
- Local community impacts
- Indigenous peoples' rights
- Relevant for companies with significant local presence
ESRS S4 - Consumers and End-Users
- Product safety and quality
- Customer privacy
- Marketing practices
- Important for B2C companies
Governance Standards (G)
ESRS G1 - Business Conduct
- Ethics and compliance
- Anti-corruption measures
- Lobbying and political engagement
- Most companies need this one
Which Standards Apply to You?
You need to do a "materiality assessment" to figure out which standards matter for your business. Here's a quick decision tree:
Definitely Needed (99% of companies):
- ESRS 1 & 2 (mandatory for everyone)
- ESRS E1 (climate change)
- ESRS S1 (own workforce)
- ESRS G1 (business conduct)
Probably Needed (50%+ of companies):
- ESRS E5 (resource use) - if you manufacture or sell products
- ESRS S2 (supply chain workers) - if you have suppliers
- ESRS S4 (consumers) - if you sell to consumers
Maybe Needed (industry-specific):
- ESRS E2 (pollution) - chemical, manufacturing industries
- ESRS E3 (water) - agriculture, textiles, beverages
- ESRS E4 (biodiversity) - agriculture, construction, mining
- ESRS S3 (communities) - extractive industries, large facilities
The Data You'll Need to Collect
For each applicable standard, you'll need:
- Policies - What are your rules?
- Actions - What are you doing?
- Metrics - What are your numbers?
- Targets - What are your goals?
Example for Climate (E1):
- Policy: "We commit to net-zero by 2050"
- Actions: "Installing solar panels, switching to EVs"
- Metrics: "2,500 tons CO2 in 2024"
- Targets: "Reduce emissions 50% by 2030"
Common Mistakes to Avoid
- Trying to report on everything - Focus on what's material
- Starting with metrics - Start with policies first
- Working in silos - You need cross-department collaboration
- Underestimating data needs - Start collecting now
- Ignoring the value chain - Your suppliers matter too
Your Action Plan
Step 1: Quick Materiality Check (1 day)
- List your main environmental impacts
- List your stakeholder groups
- Identify obvious material topics
Step 2: Deep Dive (1 week)
- Read ESRS 1 and 2 fully
- Read the specific standards that seem relevant
- Map what data you already have
Step 3: Gap Analysis (2 weeks)
- Compare requirements to current data
- Identify missing policies
- List needed metrics
Step 4: Implementation Plan (ongoing)
- Assign ownership for each standard
- Set up data collection systems
- Create policies where missing
- Start tracking metrics
Tools and Resources
- Official ESRS documents: Available from EFRAG (very technical)
- Materiality assessment tools: Various consultants offer these
- Data collection templates: Industry associations often provide
- Software solutions: Growing market of ESRS-specific tools
The Bottom Line
ESRS standards are comprehensive but logical. You don't need to master all 12 - focus on the 4-6 that matter most to your business. Start with the mandatory ones (ESRS 1 & 2), add the obvious ones for your industry, then build from there.
Remember: It's better to do a thorough job on fewer standards than a poor job trying to cover everything.