Joint call for a rapid adoption of the postponement of phase-in disclosure requirements for first wave CSRD undertakings

In light of the European Commission’s recently adopted delegated act on the European Sustainability Reporting Standards (ESRS), we collectively call for swift action to provide legal certainty for companies preparing for upcoming reporting obligations.

We, the undersigned associations, express our collective support for the European Commission’s delegated act, adopted on 11 July, on the European Sustainability Reporting Standards (ESRS) to pause additional phase-in data points for certain CSRD wave-1 undertakings by two years.

We urge the European Parliament and Council to promptly confirm their intention not to object to this delegated act. A timely confirmation will allow a swift entry into force, thereby providing the necessary legal certainty for affected companies.

The 26 February omnibus proposal included a separate legislative proposal to postpone by two years the entry into application of the CSRD reporting requirements for undertakings in the second wave and third wave (so-called “stop-the-clock” proposal). However, the stop-the-clock Directive does not postpone the reporting requirements for companies in wave one, which are required to report in 2025 information on the financial year 2024, and will have to meet additional reporting requirements for the financial years 2025 and 2026, even though the revised and simplified ESRS might subsequently modify those same requirements.

The proposed delegated act addresses this issue by freezing the ESRS reporting requirements for wave one undertakings as they are for the first year of application of the standards.

This is crucial for the following reasons:

• Maintaining EU leadership and competitiveness: This delegated act is instrumental in maintaining the EU’s leadership in transitioning to a sustainable economy. It prevents competitive disadvantages for EU industries, which is particularly crucial given the current geopolitical context. The new requirements would include commercially sensitive information and imply considerable additional resource investment, which could potentially be futile given the ongoing efforts to simplify the reporting standards. Ensuring a level playing field is essential for the continued growth and sustainability of our industries.

• Refining new reporting practices: The delegated act ensures that wave-1 companies can continue reporting as per their current scope, thereby allowing wave-1 companies to focus their efforts on improving their existing reports.

Signatories