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EFRAG and GRI Achieve Interoperability to Streamline Sustainability Reporting for European Companies

ESGEFRAG and GRI Achieve Interoperability to Streamline Sustainability Reporting for European Companies

The European Financial Reporting Advisory Group (EFRAG) and the Global Reporting Initiative (GRI) have announced a significant achievement in interoperability between the European Sustainability Reporting Standards (ESRS) and the GRI Standards. This achievement is expected to reduce the sustainability disclosure burden for many companies by eliminating the need for “double reporting,” where companies must disclose sustainability-related information according to two separate sets of standards.

The ESRS, developed by EFRAG and officially adopted by the European Commission, outlines rules and requirements for companies to report on sustainability-related impacts, opportunities, and risks under the European Union’s Corporate Sustainable Reporting Directive (CSRD). The CSRD is set to take effect from early 2024 and will expand the number of companies required to provide sustainability disclosures significantly.

The GRI Sustainability Reporting Standards are widely accepted globally for sustainability reporting by companies, promoting consistent reporting across industries and clear communication with stakeholders.

Key points from the announcement include:

  • The achieved interoperability will simplify reporting for companies and reduce complexity.
  • The ESRS will be used for reporting under the CSRD, which expands reporting requirements on environmental, human rights, social standards, and sustainability-related risks.
  • The GRI Standards are commonly used for sustainability reporting and were updated in 2021.
  • Both sets of standards align on the double materiality approach, requiring companies to disclose the impact of sustainability issues on them and their impact on society and the environment.
  • Companies already reporting under GRI will be well-prepared for ESRS reporting, and vice versa.
  • GRI will actively collaborate with EFRAG to reduce the reporting burden for companies.

This achievement represents a significant step toward simplifying sustainability reporting for companies in Europe, streamlining compliance with evolving sustainability reporting requirements.

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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