Position paper - Response to the European Financial Reporting Advisory Group's consultation on the implementation guidance for the sector-agnostic European Sustainability Reporting Standards

Business needs improved guidance supporting the EU’s common framework for companies to report on sustainability to provide reliable, decision-useful, interoperable and comparable information. The European Financial Reporting Advisory Group (EFRAG)’s investment into providing valuable implementation guidance is a positive step. For the maximum usefulness of the implementation guidance, EFRAG should consider the following refinements:

• Reconcile inconsistencies between the draft IG and the ESRS, in particular with respect to stakeholder engagement, types of information and value chain information.
• Review and revise the IG on how mitigation actions should be considered in assessing gross vs net environmental impacts.
• Ensure that companies are guided to use independent quality sources of external data.
• EFRAG and the European Commission should ensure consistency between the ESRS and the Corporate Sustainability Due Diligence Directive (CS3D) in particular in relation to value chain/ ‘chain of activity’ disclosures.