From Uncertainty to action: how to tackle the updated ESRS effectively

In recent weeks, we've witnessed updates and strides in the ongoing Sustainability Omnibus Package, an initiative by the European Commission to streamline the EU's sustainability reporting and due diligence rules under the European Green Deal.

On 3 December 2025, the European Financial Reporting Advisory Group (EFRAG) presented its final recommendation on the simplified and amended European Sustainability Reporting Standards (ESRS) to the European Commission, after gathering public input and feedback on the drafts shared in July.¹

For an explanation of what has changed, please refer to this In-Brief. 

So, what's next?

The European Commission will now review the standards and might make further changes. This proposal will normally be subject to a four-week consultation to gather more feedback.² After this, the Commission will adopt the amended ESRS via a Delegated Act six months post the Omnibus Content Proposal publication, so depending on the Omnibus legislative process we can expect this by mid-2026.

Once the Commission adopts the Delegated Act, it faces a scrutiny period by the European Parliament and the Council, typically lasting about two months. They can object but cannot amend the standards.

After this scrutiny, the standards will be published in the Official Journal of the EU, becoming directly applicable across all Member States. The goal is for companies to use the amended ESRS for their sustainability reporting over 2027 – the first year of CSRD application for Wave 2 companies (a "large company" meeting the revenue and employee criteria which are currently being redefined as part of the Omnibus Content Proposal).

With this ongoing legislative process, what steps should you take now?

We have helped Wave 1 companies (public interest entities [PIEs]) listed on an EU regulated market, credit institutions, or insurance undertakings) implement the CSRD, which took years in many cases. With a large group of Wave 2 companies being in scope for FY2027, now is the time to (re)start the CSRD implementation in order to be able to have a reporting process and organisation set-up that facilitates the data collection of non-financial data and the related capabilities to create a sustainability report. 

This is also the moment to realign your CSRD implementation with a strategic focus, and kickstart the momentum again. Here's how you can make it happen: 

1. Integrate Double Materiality insights into business strategy  

Align your sustainability reporting with your core values and strategic goals. A thorough double materiality assessment (DMA) directly informs and aligns corporate strategy by providing a data-driven foundation, highlighting your company's impact on the environment and society, as well as the financial risks and opportunities from sustainability issues. Since you will need to perform a(n) (updated) DMA in line with the amended ESRS, ensure it is integrated into the corporate strategy so that you get the most value out of it and so that you are ready for any future regulatory changes. 

The DMA is essential for crafting a robust sustainability strategy that delivers long-term value and mitigates risk. It can be used as a tool to align stakeholders within your company and build trust - over 70 percent of respondents of the PwC's Global Investor Survey believe sustainability should be integrated into corporate strategy.³

The benefits are mutual: more than two-thirds of companies reporting under CSRD or ISSB have found value beyond compliance from the insights gathered. Those leveraging these insights are enhancing areas like business strategy, supply chain, workforce, marketing, and risk management.⁴

Taking this first step properly helps you determine what information to report, which is an essential foundation to determine the scope of the CSRD implementation. By weaving DMA insights into your business strategy, you can clearly demonstrate your ambition and dedication to material topics with consistent messaging.

2. Assess the impact of the proposed ESRS changes

Now that EFRAG has presented its final recommendation on the simplified and amended ESRS to the Commission, use these as a basis for forward planning alongside the latest DMA outcome for your company. 

If you have already started investigating data availability based on the Original 2023 Set, you can now evaluate the impact of the amended ESRS to re-focus your efforts. If you are starting now, there is no substitute for reading through the amended standards – these offer better readability, being clearer and less granular, with “may requirements” removed and Application Requirements placed directly next to disclosure requirements.⁵

Use the amended ESRS to develop a flexible adaptation plan that:

• Encourages cross-functional collaboration
  • Bringing in diverse expertise from different functions such as Finance, Sustainability, Legal, IT and Audit and risk will ensure data and other qualitative information is collected correctly and efficiently and can be audited
• Focuses on essential and strategic topics
  • Based on the latest DMA outcome, get familiar with the amended ESRS for the essential and strategic topics for your company
• Allows quick adjustments when final standards are released (expected in the first half of 2026)
  • Monitor official updates and integrate these milestones into your plan, to quickly respond to any adjustments when final standards are released

3. Begin gathering data for essential topics 

EFRAG's State of Play 2025 analysis⁶ of the initial CSRD reports shows that Climate Change (E1), Own Workforce (S1), and Business Conduct (G1) topics are material for most companies (over 90 percent of statements reviewed). So, Wave 2 companies should kick off data collection promptly for these essential topics, guided by the amended ESRS from EFRAG's technical advice. 

We know that the biggest obstacle to CSRD implementation facing companies is data availability and quality.⁷ On top of that, lessons learned by companies that have already reported is that more effective use of technology would have improved the reporting process.⁸ Therefore, investing in integrated, tech-enabled systems for data collection, analysis, and management from the outset can boost data quality and simplify audits. If not, it's vital to establish reliable manual data collection. 

Starting with these three standards will help you to get acquainted with the amended Standards and learn from Wave 1 CSRD Reporters, such as:

Turning regulatory pause into opportunity

With the extra time granted as a result of the “Stop-the-Clock" proposal, we also see organisations focus on the strategic angle and long-term value creation of CSRD Reporting. It isn't just about compliance; it can be a strategic tool for growth and resilience. It enhances transparency and trust, improves risk management and operational efficiency, and opens doors to new capital and market opportunities. Aligning with other relevant Sustainability Reporting frameworks,⁹ such as GRI (Global Reporting Initiative), ISSB (International Sustainability Standards Board), and SBTi (Science Based Targets Initiative) Standards, will allow for efficiency.  

With just over a year until the reporting period for Wave 2 companies begins, now's the time to act. By prioritising these three steps, you can get your CSRD implementation back on track, moving beyond compliance and prioritising business. 

_{¹ https://www.efrag.org/en/amended-esrs
² https://www.efrag.org/sites/default/files/media/document/2025-07/FINAL%20FAQ%20EFRAG.pdf
³ https://www.pwc.com/gx/en/issues/c-suite-insights/global-investor-survey.html 
⁴ https://www.pwc.com/gx/en/issues/esg/global-sustainability-reporting-survey.html 
⁵ https://www.pwc.nl/en/insights-and-publications/themes/sustainability/what-the-amended-esrs-mean-for-your-business.html 
⁶ https://www.efrag.org/sites/default/files/media/document/2025-07/EFRAG_State%20of%20Play%202025%20Report_0.pdf 
⁷ https://www.pwc.com/gx/en/issues/esg/global-csrd-survey.html 
8 https://www.pwc.nl/en/insights-and-publications/themes/sustainability/pwcs-global-sustainability-reporting-survey-2025.html  
9 https://www.pwc.com/us/en/services/esg/library/sustainability-reporting-interoperability.html}