How were ESRS and the CSRD developed?
Within the EU, the CSRD was first proposed in 2021 to replace the NFRD.
‘CSRD intends to drive changes in company behaviour and bring sustainability reporting on par with financial reporting over time by mandating extensive disclosures about environmental, social, and governance topics’.4
The European Parliament agreed the CSRD legislation in June 2022 and it went into effect in January 2023. EU member states have until early July 2024 to transpose the requirements of the CSRD into national law. France was the first to do so in December 2023.
The ESRS were then developed to support the CSRD by the European Financial Reporting Advisory Group (EFRAG), which was appointed technical adviser to the European Commission in 2021. EFRAG, as an independent convenor, set up a project task force that brought together stakeholders to create draft standards. These 12 exposure drafts were published for comment between April and August 2022. The ESRS final drafts were published by EFRAG in November 2022, following updating to address feedback from the public consultation. These were then adopted by the European Commission as the first set of ESRS in July 2023.
The year 2025 will be the first for reporting for certain companies (see CSRD scope for details) for the fiscal year 2024.
