What are ESRS standards?

ESRS (European Sustainability Reporting Standards) are comprehensive standards regulating corporate sustainability reporting. They cover a wide range of topics, including:

• greenhouse gas (GHG) emissions,
• the use of natural resources,
• biodiversity and environmental impact,
• social issues (working conditions, workers’ rights),
• corporate governance and organizational management.

ESRS standards are mandatory for large companies operating within the EU, as well as for international enterprises whose revenues on the European market exceed a defined threshold.

What does GHG emissions reporting under ESRS look like?

1. Disclosure of Scope 1, 2 and 3 data

Companies must report emissions across three categories:

• Scope 1: direct emissions generated by the company (e.g. production processes, company transport).
• Scope 2: indirect emissions resulting from energy consumption (e.g. electricity, heat).
• Scope 3: other indirect emissions across the entire value chain (e.g. logistics, raw materials, product use, end-of-life treatment).

2. Emissions assessment methodologies

Companies must apply recognized methodologies such as the GHG Protocol or ISO 14064 to ensure data comparability and compliance with EU requirements.

3. Emission reduction targets

Companies are required to set measurable emission reduction targets aligned with EU climate objectives, such as achieving climate neutrality by 2050. Progress must be reported on a regular basis.

4. Transparency and audit

All emissions data must be publicly disclosed and subject to independent audit, ensuring their accuracy and completeness.

5. Penalties for non-compliance

In the event of non-compliance with the standards or submission of incomplete reports, companies may face the following consequences:

• significant financial penalties (in some countries amounting to several million euros),
• obligation to correct reports,
• loss of access to green financing and investments,
• reputational risk resulting from public disclosure of data,
• potential legal proceedings.

When must companies submit reports?

The first ESRS-compliant reports must be submitted by companies in 2025, based on data for the year 2024. The documents will form part of annual reports and will be submitted together with financial statements.

Who do ESRS standards apply to?

The reporting obligation applies to:

1. Large enterprises

Companies meeting at least two of the following three criteria:

• more than 250 employees,
• annual turnover exceeding €40 million,
• assets exceeding €20 million.

2. Public companies

All companies listed on EU stock exchanges (excluding micro-enterprises).

3. Selected small and medium-sized enterprises (SMEs)

Listed on regulated markets — subject to simplified requirements.

4. Non-EU organizations

• if they meet the thresholds for large enterprises,
• or generate more than €150 million in revenue within the EU.

Where are ESRS reports submitted and who verifies them?

Reports will be submitted to the national supervisory authorities of individual EU Member States. Key elements of the reporting system include:

• Competent authorities – responsible for receiving, reviewing, and verifying reports.
• Public access – reports will be public and openly accessible.
• Independent audit – mandatory for data verification.
• Digital reporting format – reporting will be carried out via electronic platforms.