What CFOs need to know and do now
In early December 2025, the Amended European Sustainability Reporting Standards were submitted to the European Commission. The EFRAG Sustainability Reporting Board approved the standards on 28 November 2025.
The aim of the amendments is clear. Reduce reporting burden and sharpen the focus on material information. Disclosures should be easier to understand and easier to prepare.
For CFOs and finance leaders, this marks an important shift. Sustainability reporting is moving closer to financial reporting. The same core principles apply. Materiality, clarity, and fair presentation now sit firmly at the center.
Below is a summary of the key changes, what they mean for your organization, and what finance teams should focus on next.
1. Key points on simplified ESRS
1.1 Materiality at the core
Double materiality assessment plays a central role in sustainability reporting. It has also been widely seen as complex and time-consuming. The Amended ESRS responds to this with a clearer and more proportionate approach.
The goal is balance. Simplification without weakening the quality of reporting. The updated guidance helps companies focus on what is truly material and avoid unnecessary detail driven by a pure compliance mindset.
There is also a stronger emphasis on fair presentation. Disclosures should reflect what matters most to stakeholders when they make decisions. This further strengthens alignment with IFRS sustainability standards.
1.2 Reduced content
The Amended ESRS reduce mandatory “shall” datapoints by 61 percent compared to the initial standards. This is a significant change.
ESRS2 datapoints are now also subject to materiality assessment. While these datapoints are general in nature and expected to be relevant for most companies, they are no longer automatically required.
Under the initial ESRS, once a topic was assessed as material, companies had to disclose all related policies, actions, targets, and metrics assessed as material. The Amended ESRS takes a more focused approach. Only disclosure requirements linked to material impacts, risks, and opportunities need to be reported and data points related are still under assessment.
1.3 Reliefs
The Amended ESRS introduced a proportionality mechanism based on reasonable and supportable information that can be obtained without undue cost or effort.
When data is not fully available, companies may report metrics using partial scope coverage across their own operations and value chain. This applies when obtaining full data would require disproportionate effort or cost.
Transparency remains essential. Companies must clearly explain data limitations and outline how they plan to improve coverage over time.
2. Scope
On 16 December 2025, the European Parliament approved a provisional agreement between MEPs and EU governments on the CSRD scope.
Only EU companies with more than 1,000 employees on average and net annual turnover above €450 million will be required to report. The rules also apply to non-EU companies with more than €450 million in EU turnover. Their EU subsidiaries and branches are included if they generate more than €200 million in turnover.
Companies with fewer than 1,000 employees will not be required to provide sustainability information to larger business partners for their CSRD reporting beyond what is included in voluntary reporting standards.
3. The new EFRAG Knowledge Hub
The EFRAG Knowledge Hub is a digital platform designed to support the understanding and application of the ESRS.
It brings together the standards, guidance, background documents, and supporting materials in one place. The platform is structured and interactive, making it easier to navigate requirements and understand how different disclosures connect.
For companies and other stakeholders, this supports more consistent interpretation and application of the standards.
4. What CFOs should prioritize now
Simplification is now a real opportunity. Finance teams should revisit their double materiality as-sessment using the Amended ESRS guidance. The focus should be on what truly matters for the business and for key stakeholders.
At the same time, strong data foundations remain critical. High quality reporting depends on reli-able and consistent data. The delays in reporting requirements should be used wisely to improve data processes and governance.
Just as IFRS reshaped financial reporting over time, ESRS will continue to evolve. Investing in solid data foundations now will reduce the need for major rework later and support more efficient re-porting in the years ahead.