ESRS 1 General Requirements

ESRS 1 establishes the foundational principles and requirements that companies must adhere to when preparing their sustainability reports. While this section does not mandate specific disclosures, it plays a crucial role in guiding companies by setting the general framework for their sustainability reporting as it defines how undertakings shall carry their materiality assessment, as well as other miscellaneous requirements for reporting.

Materiality assessment

To determine whether a specific disclosure in the environmental, social, and governance topical standards is mandatory, organizations must conduct a double materiality assessment. This process helps identify the most relevant and significant topics for disclosure. ESRS requires companies to explain their materiality assessment process, including the methodologies, assumptions, and results.

After completing the materiality assessment and identifying the most relevant topics for their business, organizations can create disclosures on SRM by selecting only the Topical Standards that align with their impacts and operations, focusing on those identified as material to their company.

Group	Number	Topical Standards	Application
Cross-cutting	ESRS 1	General Requirements	Mandatory for all companies
Cross-cutting	ESRS 2	General Disclosures	Mandatory for all companies
Environment	ESRS E1	Climate Change	Mandatory only if deemed as material to the company.
	ESRS E2	Pollution
	ESRS E3	Water and marine resources
	ESRS E4	Biodiversity and ecosystems
	ESRS E5	Resource use and circular economy
Social	ESRS S1	Own workforce
	ESRS S2	Workers in the value chain
	ESRS S3	Affected communities
	ESRS S4	Consumers and end users
Governance	ESRS G1	Business conduct

Miscellaneous guidelines for reporting

🔷 Level of disaggregation

At each Disclosure Requirement (DR) ESRS mandates a specific level of disaggregation for each data point (DP). However, for DPs or DRs that do not require a particular level of disaggregation, companies may choose to provide more detailed disclosures if they believe it will enhance the clarity of their impacts, risks, and opportunities. Depending on the purpose and context of the data, organizations may opt to disaggregate information by country, significant site, or asset

🔷Time horizons and comparative information

Comparative Information: Companies must disclose comparative information in respect of the previous period for all quantitative metrics and monetary amounts disclosed in the current period. This means that if a company is reporting a quantitative metric for their FY25, they should also disclose the same metric for their FY24.

Base year: When reporting development or progress towards a target, reporters shall present comparative information with respect to a base year.
Short term: Some DR’s will require undertakings to report their metrics or targets on short-term horizon, which means the period adopted by the company as their reporting period in their financial statements.
Medium term: Some DR’s will require undertakings to report their metrics or targets on medium-term horizon. This period spans between the end of the short-term period up to 5 years after the same.
Long term: For DR”s requiring undertakings to report their metrics or targets on long-term horizon, this would be any period beyond 5 years after the end of the short-term horizon. However, companies are expected to provide additional breakdowns when impacts or actions are expected to last or occur in even longer periods.

🔷Units

Currency: Companies must use the presentation currency of its financial statements.
Units of measure: Undertaking’s shall make their disclosures in the units of measures required by each specific DR or DP. However, when a specific unit of measure is not defined within the appropriate DR or DP, in order to ensure clarity companies shall disclose the units of measures and avoid abbreviations. When a DR requires the use of an specific units of measure, this will be flagged within the specific question and field at SRM.