GSG Impact, with other leading organisations in the field of impact such as B Lab and Social Value International, has issued an open letter to the European Commission, urging the preservation of key principles underpinning the European Sustainability Reporting Standards (ESRS), ahead on the discussion of the new Omnibus Simplification Package, to be addressed on February 26.

While we acknowledge the merit in streamlining certain data points to avoid redundancies, we strongly urge that changes made to the ESRS do not compromise its integrity.

Key recommendations we are advocating for:

1. Preserve Double Materiality: Double materiality helps identify and address individual corporate impacts that collectively lead to systemic risks — such as climate change, biodiversity loss, and social inequalities. Preserving this principle not only ensures that ESRS continues to reflect the interconnected nature of sustainability challenges, but it will also provide decision-makers with a comprehensive understanding of sustainability-related risks and opportunities.

2. Abstain from changes in ESRS 2: Aligning ESRS framework with other disclosure standards such as IFRS S1, maximises interoperability with other disclosure standards and facilitates a cohesive and unified approach to sustainability reporting across jurisdictions. Its current structure also allows capturing key information on actions necessary for corporate sustainability management, including governance functions detailing oversight and accountability, embedding sustainability into strategy and business models, identifying sustainability impacts, risks, and opportunities; implementing actions to address them; and measuring performance and progress.

Our Call to Action

We call on the European Commission to preserve the integrity of the ESRS by upholding double materiality and retaining ESRS 2. These foundational standards are essential to ensuring businesses stay transparent, accountable, and aligned with the EU’s sustainability objectives. 

Read the full letter.