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Under the 2023 ESRS, move from the material sustainability matter to the related disclosure requirements, then to the specific datapoints needed to meet those requirements. EFRAG's implementation guidance describes this as determining material matters first and then determining material information at the more granular level of disclosure requirements or datapoints.

The assessment should cover the undertaking's own operations and upstream and downstream value chain. It should also apply objective criteria and thresholds that fit the undertaking's facts and circumstances, because ESRS does not mandate one fixed sequence of steps for the materiality assessment.

Under the 2023 ESRS, IRO-2 requires the sustainability statement to list the disclosure requirements complied with and to make understandable which topics were omitted as not material as a result of the materiality assessment.

If climate change is assessed as not material and the undertaking omits all ESRS E1 disclosure requirements, ESRS 2 requires a detailed explanation of the materiality-assessment conclusions for climate change, including forward-looking analysis of conditions that could make climate change material in the future. For other non-material topics, the undertaking may provide a brief explanation of the materiality-assessment conclusions.

Some ESRS datapoints correspond to information used under other EU sustainable-finance frameworks, including SFDR, benchmark, and Capital Requirements Regulation disclosures. Under the 2023 ESRS, ESRS 2 IRO-2 requires a table of all EU-law-derived datapoints listed in Appendix B, showing where they appear in the sustainability statement or marking them as Not material.

The revised standards adopted in July 2026 retain the table and the Not material marker but place the list in Appendix A of ESRS 2. In either version, silence is not enough for these listed datapoints; use the appendix that belongs to the version applied.

Yes. Under the 2023 ESRS, the sustainability statement includes material upstream and downstream value chain information where needed to explain material impacts, risks, and opportunities. If the undertaking cannot collect required value chain information after reasonable efforts, ESRS 1 requires it to estimate the information using reasonable and supportable information, including sector-average data and other proxies.

Estimates still follow materiality. ESRS 1 extends value chain information only to the parts of the value chain where the matter is material, and estimates must meet the qualitative characteristics of sustainability information.

The revised standards are adopted but not yet in force. Once applicable, revised ESRS 1 allows the undertaking to use information collected directly from value chain counterparties or estimates, depending on the practicability and reliability of the necessary input. Estimates may use internal or external information, including indirect sources, sector averages, sample analyses, market or peer data, spend-based data, and other proxies.

The revised disclosure rule also changes the description of an estimated metric. Revised ESRS 2 GDR-M requires the metric, unit, calculation method, sources, and, where relevant, the estimation method with significant assumptions and limitations. For a value chain metric, disclose reliance on indirect sources or proxies and planned actions to improve data quality where applicable.

Directive (EU) 2026/470 requires national law to treat a value chain undertaking that does not exceed an average of 1,000 employees in the preceding financial year as a protected undertaking. For CSRD reporting requests, national measures must give that undertaking the right to decline information exceeding the voluntary standards under Article 29ca. The cap does not require the protected undertaking to provide sustainability information, and it does not limit requests made for another purpose, including a separate EU due-diligence duty.

A reporting undertaking may rely on the value chain undertaking's self-declaration of protected status unless it knows, or can reasonably be expected to know, that the declaration is manifestly incorrect. For the first three years in which the reporting undertaking is subject to CSRD reporting, if necessary value chain information is unavailable, it must explain its efforts to obtain the information, why it could not obtain all of it, and its plans to obtain it later. After that period, the amended Directive requires direct information or estimates as appropriate. Member States must transpose these amendments by 19 March 2027, so national implementation must be checked.

Under the 2023 ESRS, when metrics include value chain data estimated from indirect sources, the disclosure must identify the metric, explain the basis for preparation, describe the resulting level of accuracy, and, where applicable, describe planned actions to improve accuracy.

ESRS also addresses estimation and outcome uncertainty. The disclosure should let users understand the significant uncertainties, assumptions, and limits that affect the reported quantitative metric or monetary amount.

The documentation should show why an estimate was needed under the applicable ESRS version and why the chosen proxy is supportable for the material matter. It should let reporting, finance, procurement, sustainability, and assurance teams follow the trail from source data to disclosure.

A useful file separates unavailable primary data from the estimation method. For example, a supplier non-response problem is different from a downstream-use problem where measuring each end user would be impracticable and a product-use estimate is more relevant.

Estimates are acceptable only within the applicable ESRS reporting logic. They cannot replace the materiality assessment, conceal a known data gap, or support precision that the inputs do not provide. Under the 2023 ESRS, sector-average data or other proxies must still produce information that meets the qualitative characteristics of sustainability information.

EFRAG IG 2 also warns that quantitative measures of indirect impacts are not always the most relevant disclosure. If a calculated footprint would be too arbitrary or would not explain the undertaking's contribution to managing a material impact, teams should reassess whether another ESRS disclosure, narrative explanation, policy, action, target, or entity-specific metric better explains the matter.

No. ESRS uses double materiality as the basis for sustainability disclosures, but it does not prescribe one fixed numeric score, rating scale, or cut-off that every undertaking must use.

A company may use a scoring matrix, but the matrix has to reflect the applicable ESRS criteria and the undertaking's own facts. EFRAG IG 1, which relates to the 2023 ESRS, states that ESRS 1 sets criteria rather than specific thresholds. Unsupported universal cut-offs or fixed point totals should not be presented as an ESRS rule.

Impact materiality is about the undertaking's impacts on people or the environment, including impacts connected with its own operations, products, services, business relationships, and value chain.

For negative impacts, score severity using scale, scope, and irremediable character. For potential negative impacts, add likelihood and the relevant time horizon. For positive impacts, use scale and scope, with likelihood added for potential positive impacts. For human rights impacts, severity can take precedence over likelihood when identifying material matters.

Financial materiality is about sustainability-related risks and opportunities that have, or could reasonably be expected to have, material financial effects on the undertaking.

A practical scorecard should assess likelihood and potential magnitude of financial effects across short-, medium-, and long-term horizons. Effects can relate to financial performance, financial position, cash flows, access to finance, or cost of capital. ESRS allows appropriate quantitative or qualitative thresholds, so a company can use monetary thresholds, relative thresholds, or qualitative ranges where reliable measurement is not available.

The scoring file should be audit-ready enough to show how the undertaking moved from identified impacts, risks, and opportunities to material matters and disclosures. It should not only show final red, amber, or green labels.

Retain the methodology, assumptions, evidence base, stakeholder or expert input, thresholds, scoring rationale, management validation, and the final list of material impacts, risks, and opportunities. Under the 2023 ESRS, ESRS 2 IRO-1 and IRO-2 require transparency on the process and the disclosure requirements covered by the sustainability statement. Confirm the corresponding references if the revised ESRS apply.

In the 2023 ESRS, ESRS 1 explains how to read and apply the standards. It covers the categories of standards, double materiality, value-chain reporting, time horizons, presentation of the sustainability statement, and concepts such as impacts, risks and opportunities.

In the 2023 ESRS, ESRS 2 tells an undertaking what general information to provide, including governance, strategy, the process for identifying and assessing impacts, risks and opportunities, and minimum disclosure requirements for policies, actions, metrics, and targets.

The ESRS architecture has three categories: cross-cutting standards, topical standards, and sector-specific standards. ESRS 1 and ESRS 2 are the cross-cutting standards and apply across the sustainability matters covered by topical and sector-specific standards.

Topical ESRS cover environmental, social, and governance topics. They add topic-specific disclosure requirements and may also include requirements that are applied together with ESRS 2 general disclosures. When a sustainability matter is material, the undertaking looks to the relevant topical or sector-specific ESRS and then applies the ESRS 2 minimum disclosure requirements for policies, actions, metrics, and targets where applicable.