CSRD value chain estimates under ESRS

Start with ESRS 1 paragraphs 63 to 65. The sustainability statement is extended beyond the reporting undertaking only for material impacts, risks, and opportunities connected through direct or indirect business relationships in the upstream or downstream value chain. ESRS 1 paragraph 64 is the guardrail: the undertaking is not asked to report on every supplier, distributor, customer, user, or end-of-life actor.

An estimate is appropriate only after that boundary test shows that value-chain information is needed and direct collection has not produced the necessary reliable information after reasonable efforts. If the matter is not material for the relevant value-chain part, do not invent a metric. If it is material, scope the estimate to that part of the chain and to the specific disclosure it supports.

The forthcoming value-chain request cap does not replace this ESRS estimation test. Directive (EU) 2026/470 requires national transposition by 19 March 2027 and limits specified sustainability-reporting requests to protected undertakings by reference to the Article 29ca voluntary standard. It does not prohibit voluntary sharing. Check applicable national law and the final delegated standard before deciding what may be requested; then apply ESRS 1 paragraph 69 to any required information that remains unavailable.

EFRAG IG 2 treats reasonable effort as fact-specific. It depends on the reporting burden of obtaining direct data, the expected quality loss from not obtaining it, the processes used to collect value-chain information, and the resources dedicated to those processes. That means a reporter needs evidence of the attempt, not a sentence saying the data was unavailable.

The record should be built at the metric or disclosure level. A Scope 3 category, a living-wage risk screen for facilities in high-risk countries, and a downstream use-phase energy estimate need different counterparties, indirect sources, assumptions, and accuracy explanations.

ESRS 2 BP-2 paragraph 10 applies when metrics include upstream or downstream value-chain data estimated using indirect sources such as sector-average data or other proxies. The disclosure has four parts: identify the affected metrics, describe the basis for preparation, describe the resulting level of accuracy, and, where applicable, describe planned actions to improve accuracy in the future.

Make the final number traceable to the estimate package. Do not bury an estimated input inside an aggregate total without explaining which metric used the estimate and what level of accuracy the evidence supports.

ESRS 1 section 7.2 says measurement uncertainty can arise when quantitative metrics and monetary amounts, including value-chain information, cannot be measured directly and can only be estimated. An estimate can still meet the qualitative characteristics of information when its assumptions, limitations, and uncertainty are accurately described and explained.

A visible limitation is needed when the source is broad, the value-chain segment is only partly covered, or the method could imply precision that the evidence does not support. EFRAG IG 2 also warns that quantifying indirect impacts does not always produce relevant information about the undertaking's impact; in some circumstances a different metric or narrative may be more faithful.

ESRS Appendix B treats verifiability as the ability to corroborate the information itself or the inputs used to derive it. For value-chain estimates, that means the record should connect the ESRS requirement, materiality conclusion, direct-data effort, indirect source, calculation, limitation, BP-2 wording, and approval evidence.

Keep the package at the level of the affected metric or disclosure. A general policy saying proxies are allowed will not explain why a specific supplier-tier estimate, product-use estimate, living-wage screen, or Scope 3 input is reasonable and supportable at the reporting date.