Latest Developments on ESRS Regulations (July 2025)
The European Sustainability Reporting Standards (ESRS) are undergoing a major revision aimed at simplifying requirements and making reporting more practical for companies. On July 31, 2025, EFRAG published the new exposure drafts, which reflect the EU’s shift toward easing the administrative burden under the Corporate Sustainability Reporting Directive (CSRD). A key highlight of the revisions is the sharp reduction in reporting complexity—total datapoints have been cut by 68%, and mandatory datapoints alone by 57%. This simplification is designed to make sustainability disclosures more achievable for businesses while retaining their core objectives of transparency and accountability.
The list of changes in detail can be found at EFRAG’s site at https://www.efrag.org/en/amended-esrs-0 .
The revised exposure drafts also introduced a clearer separation between mandatory disclosure requirements (“shall disclose”) and non-mandatory illustrative guidance (NMIG). By removing prescriptive details from the standards themselves and placing them into guidance, the EU hopes to create a more flexible and company-centered reporting framework. This change aims to empower companies to focus on material issues, reduce compliance fatigue, and enhance alignment with other international frameworks like the ISSB, GRI, and SASB.
| Area | Before Revision | After Revision (July 2025 Drafts) | Change (%) |
| Total datapoints | ~1,200 | ~380 | -68% |
| Mandatory datapoints | ~400 | ~170 | -57% |
| Length of standards | ~1,200 pages | ~530 pages | -55% |
| Guidance integration | Mixed with mandatory text | Shifted into Non-Mandatory Illustrative Guidance (NMIG) | Structural |
| Clarity of disclosures | Less distinction between mandatory/optional | Explicit labeling: “shall disclose” vs. guidance | Conceptual |
Alongside the release of the drafts, EFRAG launched a 60-day public consultation process, open until September 29, 2025. Companies, investors, regulators, and civil society stakeholders are invited to provide input via a structured online survey. Their feedback will be instrumental in shaping the final technical advice that EFRAG is scheduled to deliver to the European Commission by November 30, 2025. This consultation reflects the EU’s commitment to participatory policymaking, ensuring that the resulting standards balance investor needs, business realities, and sustainability objectives.
Finally, the revisions must be understood within the broader regulatory timeline of EU sustainability reporting. With the “stop-the-clock” directive deferring reporting obligations for second- and third-wave companies, and the Omnibus simplification package narrowing CSRD’s scope to mainly large entities, the revised ESRS come at a pivotal time. They are intended not just as a simplification but as a recalibration—ensuring reporting remains credible while being manageable.
Legislative adoption is expected to follow in 2026 through delegated acts, which will finalize the revised framework for implementation.
