EFRAG’s review of the European Sustainability Reporting Standards (ESRS) as part of the first Omnibus package is crucial for FERMA for several reasons.
- It will reduce the sustainability reporting burden while allowing for more flexibility.
- It preserves double materiality assessment, which is key to enhancing good risk management practices.
- Overall, the ESRS will be more accessible and implementable.
As stressed in the answer to EFRAG’s consultation and in line with our key messages on the first Omnibus, FERMA insists on the need to simplify the current reporting framework through a substantive reduction of mandatory datapoints (57%) to prioritize the more meaningful ones. In this regard, the identification and prioritization of topics that are most likely to be material are essential and will result in less complexity regarding the materiality assessment.
In the meantime, FERMA stresses the importance of preserving the double materiality assessment in the CSRD while strengthening a proper Enterprise Risk Management (ERM) methodology for companies in order to allow for both consistency and efficiency between EU companies. The CSRD provides the right framework for sustainability disclosures for the first time at EU level and this ambition must be preserved.