We were pleased to participate in the first public consultation on the revision of the European Sustainability Reporting Standards (ESRS), opened by EFRAG until the 29th of September. As one of the active participants in the first wave of CSRD disclosures for 6 of the 20 listed companies in Romania, we consider it our responsibility to contribute actively to the dialogue shaping the future of sustainability reporting in Europe.
Below, we outline our reflections on several key sections of the draft, referencing the specific annexes, paragraphs, and guidance documents addressed in the consultation. We encourage all company representatives and consultants to share their views.
Chapter 3 of ESRS 1 – Double Materiality Assessment (DMA)
We partially agreed with the proposed amendments. The revised Chapter 3 represents a clear improvement over earlier drafts: the simplified list of topics and subtopics, the distinction between bottom-up and top-down approaches, and the annex on mitigation/remediation measures are all valuable additions. The latter, in particular, provides clarity on whether mitigation actions should reduce severity scores, a question frequently raised by companies.
However, we remain concerned about the suggestion that undertakings may stop investigating if immediate information on time horizons is not available. This creates a risk that impacts deemed immaterial in the short term may be ignored, even though they could prove highly material in the medium or long term. Companies should be guided to consider these dynamics rather than be given the impression that they may bypass deeper analysis.
We also highlighted that the main challenge is not ambiguity, but capacity. Many companies, especially in Romania, struggle with concepts such as forecasts and scenario analysis. Including simple, practical examples in the double materiality module would increase accessibility and reduce reliance on consultants or auditors, who often apply inconsistent methodologies.
Paragraphs 34–36 and Appendix C of ESRS 1 – Mitigation, Remediation, and Prevention
On this point, we agreed with the proposed amendments. The clarifications and accompanying tables are important and useful.
That said, we emphasised that prevention or mitigation measures must not be interpreted as reasons to omit reporting. From our experience with heavy industries (e.g., petroleum, coal), even companies with high safety standards and large renewable investments continue to face inherent risks (e.g., pipeline spills). These impacts should always be reported transparently, alongside the prevention and remediation measures undertaken.
Balance Between Prescriptiveness and Effort (General Requirements)
Here, we partially agreed. While we welcome clarifications on aggregation levels, we disagreed with the removal of requirements for undertakings to designate a responsible person or authority for policy implementation. Accountability is crucial. Without it, the link between identified impacts and a company’s strategic response risks becoming diluted.
Non-Mandatory Illustrative Guidance (NMIG)
We commented specifically on NMIG for ESRS E1–E5. Our position is that the standards should include as many practical examples and references as possible. In emerging markets, many companies lack sustainability departments and struggle to interpret requirements. References to existing frameworks and tools, such as the European Pollutant Release and Transfer Register, Natura 2000 maps, biodiversity-sensitive zones, and air quality maps, would make the standards more usable.
Clearer definitions are also needed. For example, in ESRS E5, the term “biological materials” should be explicitly defined to avoid divergent interpretations between companies and auditors.
Finally, reporting should be more strongly connected to existing systems (e.g., environmental permits). In practice, we often extracted relevant targets from permits to ground disclosures in real obligations. Stronger links to such systems would improve both clarity and relevance.
Paragraph 89 and 92 of ESRS 1 – “Undue Cost or Effort” Relief
We partially agreed with these provisions. While we recognise the need for flexibility, we strongly disagree with the idea that no reliable or estimated data can be used. Proxies (geographical, industrial, peer-based) always exist and should be encouraged.
Expanding this relief to the value chain is particularly problematic. Allowing undertakings to report only partial metrics, with no time limit for improvement, risks undermining comparability and accountability. Numbers are the backbone of sustainability reports; without them, disclosures risk becoming fragmented and narrative-driven.
Paragraph 23 of ESRS 2 – Quantitative Projections of Financial Effects
We supported Option 1: Quantitative projections, even when uncertain, are more valuable than qualitative disclosures alone. They provide a basis for comparability across companies and sectors.
Allowing undertakings to omit such projections on the grounds of limited resources creates perverse incentives. The credibility of sustainability disclosures depends on numbers—not only on narratives.
Interoperability and Simplification Objectives
We partially agreed. Harmonization, especially around the financial control approach, is welcome. However, we strongly disagreed with two points:
- Scope 3 emissions must not be optional. For many sectors, these represent 85–90% of total emissions. Excluding them undermines the directive’s integrity.
- Quantification of financial effects must not be omitted. Companies within scope of the ESRS have the resources to build or acquire this capacity. Allowing exemptions based on “lack of skills” sets a dangerous precedent.
Conclusion
Overall, we commend the progress made in simplifying and clarifying the ESRS. Yet, we believe ambition must not be sacrificed for flexibility. The directive’s credibility depends on accountability, robust data, and comprehensive coverage—including Scope 3 emissions and financial projections.
For sustainability reporting to drive real impact, standards must be practical yet uncompromising, rooted in transparency, and anchored in clear guidance and accountability.
As one of the early adopters of sustainability reporting in Romania, we remain committed to contributing to this dialogue and ensuring that the ESRS become both practical for companies and meaningful for stakeholders across Europe.