The Global Reporting Initiative (GRI) has submitted its official response to two European Commission consultations, outlining critical recommendations for the revised European Sustainability Reporting Standards (ESRS). The submission focuses on enhancing global regulatory alignment, supporting economic resilience, and reducing the administrative burden on reporting companies.
The consultations address both the redrafted mandatory ESRS and a new voluntary reporting standard designed for companies currently outside the regulatory scope. GRI welcomed the European Union’s decision to preserve double materiality—evaluating both impact and financial perspectives on an equal footing—at the core of the framework.
Whilst acknowledging that the simplification of the ESRS was a necessary step, GRI’s response details several areas requiring adjustment to ensure the standards remain practical and effective:
- International alignment: Strengthening cohesion with existing global frameworks to help corporations avoid duplicate reporting and leverage their established sustainability practices.
- Asset management transparency: Removing a proposed exemption for assets under management to ensure disclosure requirements for asset managers match global best practices, thereby supporting sustainable capital flows.
- Value chain limitations: Reducing restrictions on how companies exchange sustainability data across their supply chains, warning that the proposed value chain cap could hinder the collection of data needed to manage operational risks.
- Voluntary standard enhancements: Incorporating double materiality assessments and disclosures into the voluntary standard for mid-sized companies to improve strategic utility for investors and stakeholders.
GRI’s submission builds upon its technical involvement with the ESRS since 2021, which includes co-creating the initial standards alongside EFRAG and contributing to the recent Omnibus legislative process.
Robin Hodess, CEO of GRI, emphasised that keeping impact and financial materiality equally weighted is essential for companies to assess risks, improve strategy, and maintain market competitiveness. She noted that as sustainability reporting evolves globally, the EU’s approach helps establish the foundations for a more coherent international system.
Susanne Stormer, Chair of the Global Sustainability Standards Board (GSSB), added that effective standards must provide clarity, trust, and consistency. She highlighted the ongoing interoperability between the ESRS and GRI Standards, noting that collaboration with the International Sustainability Standards Board (ISSB) is vital to creating a streamlined yet comprehensive global reporting environment that addresses corporate impacts, risks, and opportunities.
