ESRS Reporting: Complete Guide for 2026

What Are the European Sustainability Reporting Standards?

The European Sustainability Reporting Standards, known as ESRS, are the mandatory disclosure standards that underpin the Corporate Sustainability Reporting Directive. Developed by EFRAG and adopted by the European Commission, these standards define exactly what information companies must disclose about their environmental, social, and governance performance. Understanding ESRS is essential for any organisation that falls within CSRD scope — and increasingly relevant for companies in global supply chains that need to provide data to their European partners.

ESRS Structure: The Complete Framework

The ESRS framework consists of twelve standards organised into three groups, plus two cross-cutting standards that apply to every reporting organisation.

Cross-Cutting Standards

ESRS 1 — General Requirements. Defines the architecture of the standards, including the concepts of double materiality, due diligence, and the reporting boundary. Every organisation subject to CSRD must understand and apply ESRS 1.

ESRS 2 — General Disclosures. Requires all in-scope companies to disclose information about governance, strategy, impact and risk management, and metrics and targets. ESRS 2 disclosures are mandatory for every reporting entity regardless of materiality assessment results.

Environmental Standards (E1 through E5)

• E1 — Climate Change. Covers greenhouse gas emissions (Scope 1, 2, and 3), transition plans, climate-related risks and opportunities, and energy consumption. For most organisations, this is the most data-intensive standard.
• E2 — Pollution. Addresses air, water, and soil pollution, including substances of concern and microplastics.
• E3 — Water and Marine Resources. Covers water consumption, withdrawal, discharge, and impacts on marine ecosystems.
• E4 — Biodiversity and Ecosystems. Addresses impacts on biodiversity, land use change, and ecosystem services.
• E5 — Resource Use and Circular Economy. Covers material flows, waste management, and circular economy practices.

Social Standards (S1 through S4)

• S1 — Own Workforce. Covers employment practices, working conditions, diversity, health and safety, and labour rights for direct employees.
• S2 — Workers in the Value Chain. Extends workforce disclosures to workers in the supply chain and downstream value chain.
• S3 — Affected Communities. Addresses impacts on communities where the company operates or sources materials.
• S4 — Consumers and End-Users. Covers product safety, data privacy, and responsible marketing practices.

Governance Standard

• G1 — Business Conduct. Covers corporate culture, anti-corruption, whistleblowing, political engagement, and payment practices.

How Double Materiality Determines Your Scope

Not every topical standard applies to every organisation. The ESRS framework uses double materiality to determine which standards and data points are material to your business. You must assess both impact materiality — your organisation’s actual or potential impacts on people and the environment — and financial materiality — how sustainability matters create risks or opportunities that affect your financial position.

Standards and data points deemed non-material through a rigorous, documented assessment can be excluded from your report. However, ESRS 2 general disclosures and E1 climate change disclosures carry a rebuttable presumption of materiality, meaning you must provide a detailed explanation if you exclude them.

Phased Adoption Timeline

CSRD and ESRS are being implemented in waves:

• 2025 reporting (FY 2024): Large public-interest entities already subject to the Non-Financial Reporting Directive.
• 2026 reporting (FY 2025): Other large undertakings meeting two of three criteria — more than 250 employees, more than EUR 50 million turnover, or more than EUR 25 million total assets.
• 2027 reporting (FY 2026): Listed SMEs, with an option to opt out for up to two additional years.
• 2029 reporting (FY 2028): Non-EU companies with significant EU operations meeting specified thresholds.

What Data Do You Need?

The data requirements for ESRS reporting are extensive. At a minimum, organisations need to prepare the following:

• Greenhouse gas emissions data across all three scopes with supporting activity data and emission factors.
• Energy consumption broken down by renewable and non-renewable sources.
• Workforce metrics including headcount, diversity breakdowns, training hours, and health and safety statistics.
• Governance data covering board composition, sustainability oversight structures, and business conduct policies.
• Policies, targets, and action plans for each material topic.
• Financial effects of sustainability risks and opportunities.

How Software Helps with ESRS Compliance

Managing over one thousand data points across twelve standards in spreadsheets is a recipe for errors, missed deadlines, and audit failures. Dedicated CSRD reporting software addresses these challenges by providing structured data collection workflows mapped to each ESRS standard, automated emission calculations with up-to-date factor databases, materiality assessment tools that determine your reporting scope, progress dashboards that show completion status across all standards, assurance-ready audit trails for every data point, and report generation in the required European Single Electronic Format.

The right software does not just make compliance possible — it makes it efficient, reducing the cost and effort of annual reporting while improving data quality and stakeholder confidence.

Preparing Your Organisation

Start with these practical steps:

1. Determine your reporting timeline. Identify which wave of CSRD applies to your organisation and work backwards to set internal milestones.
2. Conduct a gap analysis. Compare your current data collection and reporting processes against ESRS requirements to identify what you already have and what you need.
3. Complete your double materiality assessment. This determines the scope of your report and should involve internal and external stakeholders.
4. Select your technology platform. Choose software that covers all applicable ESRS standards and integrates with your data sources.
5. Build your data collection network. Identify data owners across the organisation and establish collection workflows and timelines.
6. Engage your auditor early. Discuss your reporting approach and data management processes with your assurance provider before the reporting deadline.

Start Your ESRS Reporting Journey

ESRS reporting is a significant undertaking, but with the right preparation and tools, it is entirely manageable. Horizon ESG provides purpose-built software for ESRS compliance, covering every standard from E1 through G1 with structured workflows, automated calculations, and assurance-ready documentation. Book a demo to see how we can help your organisation meet its CSRD obligations with confidence.