The European Commission has adopted a simplified version of the European Sustainability Reporting Standards (ESRS), significantly reducing reporting requirements for companies. According to the Commission, the revised standards cut mandatory disclosure requirements by 60% and reduce the overall number of data points by more than 70%, with the aim of lowering compliance costs by approximately 30% per company. 

Alongside the revised ESRS, the Commission also introduced a voluntary sustainability reporting standard for companies outside the scope of the Corporate Sustainability Reporting Directive (CSRD), particularly small and medium-sized enterprises (SMEs). Under the new framework, companies subject to the CSRD cannot request sustainability information from suppliers beyond what is required under the voluntary standard, helping reduce the reporting burden across value chains. 

These updates form part of the EU Omnibus Simplification Package, launched in February 2025 to streamline key sustainability legislation, including the CSRD and the Corporate Sustainability Due Diligence Directive (CSDDD). Recent legislative amendments are expected to remove around 90% of companies from the original CSRD scope and approximately 70% of companies from the CSDDD. 

The Commission described the ESRS revision as a key element of its simplification agenda, emphasizing that reducing the reporting scope alone would not have delivered the intended compliance cost savings. The revised standards are intended to maintain the objectives of sustainability reporting while making reporting more proportionate and practical for businesses. 

The revised ESRS and the new voluntary standard will now undergo scrutiny by the European Parliament and the Council of the European Union for an initial two-month review period, which may be extended by an additional two months. Meanwhile, the EU has already postponed reporting obligations for the next wave of CSRD companies and continues its broader efforts to simplify the EU Taxonomy and other sustainability regulations.