7. July 2023
On 7 July 2023, the DRSC submitted its response on the draft delegated act on Set 1 of the European Sustainability Reporting Standards (ESRS) to the European Commission (COM). The COM published this draft for consultation on 9 June 2023 with a consultation period of four weeks.
In its response to the COM the DRSC welcomes the proposed changes to the standards in terms of practicability, clarity, and proportionality, strengthening the role of undertakings’ materiality analysis. In this context, however, the missing link to the reporting obligations of financial market participants according to the Sustainable Finance Disclosure Regulation (SFDR, Regulation (EU) 2019/2088) is subject to criticism. The DRSC further emphasises the need for alignment of ESRS with IFRS Sustainability Reporting Standards, in particular with regard to the subject of financial materiality. Another point of criticism relates to the COM’s proposal for exclusive gross presentation when disclosing expected financial effects from environment-related risks and opportunities.
The DRSC had already commented on EFRAG’s consultation drafts in August 2022 and to the European Commission in January 2023, where, among other things, a stronger consideration of the individual materiality assessment was advocated.
The DRSC Briefing paper (in German) of 12 June 2023 provides an overview of the changes compared to the EFRAG drafts of November 2022. In addition, the DRSC provides a detailed illustration of the changes in the form of comparative documents.