The European Financial Reporting Advisory Group (EFRAG) has released revised draft European Sustainability Reporting Standards (ESRS) that significantly cut the scope and complexity of corporate ESG disclosures required under the EU’s Corporate Sustainability Reporting Directive (CSRD). The move is part of the European Commission’s Omnibus I proposal to reduce regulatory burdens, with potential implications for African companies exporting to Europe or operating as part of EU-linked supply chains.
The changes remove all voluntary disclosures and reduce total reporting datapoints by 68% compared to the original ESRS adopted in 2023. This surpasses EFRAG’s earlier projection of a 66% reduction and is intended to make sustainability reporting more practical for companies without undermining transparency.
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EFRAG said the revisions focus on “cutting complexity and improving usability,” following consultations with businesses already reporting under the CSRD as well as those preparing to do so. One major area of simplification targets the “double materiality assessment,” which requires companies to report on both how sustainability issues affect their operations and how their operations impact the environment and society. Many companies had flagged the assessment as overly resource-intensive and disproportionate to the insights it produced.
In the updated draft, EFRAG has clarified that materiality reviews should focus on identifying the most significant topics, with evidence requirements kept reasonable. It has introduced practical considerations for carrying out the assessment and provided clearer criteria for determining what information is relevant.
Other adjustments improve the readability of sustainability statements, align them more closely with broader corporate reporting, and enhance compatibility with the International Financial Reporting Standards (IFRS) sustainability framework. This includes adopting common terminology where possible and introducing relief measures such as exemptions when reporting would involve undue cost or effort.
Overall, the revised standards are more than 55% shorter, with mandatory datapoints reduced by 57%. EFRAG says the changes are designed to balance ambition with workability, ensuring that reporting supports rather than hinders resilience, investment, and long-term value creation.
For African businesses, the revisions could ease compliance costs, especially for exporters in sectors such as agriculture, mining, and manufacturing that supply European markets. Many African firms — including small and medium-sized enterprises — are indirectly subject to EU sustainability requirements through contractual obligations with European buyers. Simplified ESRS rules may help reduce the administrative and technical burden of gathering data across complex supply chains.
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Analysts note, however, that while the changes could lower compliance costs, companies will still need to maintain credible systems for tracking and verifying sustainability performance if they wish to meet EU expectations. Simplification of the reporting process does not reduce the importance of accurate, verifiable ESG information, particularly for high-impact sectors facing increasing scrutiny on climate risks, human rights, and supply chain practices.
The updated ESRS drafts are open for a 60-day public consultation until September 29, 2025. The European Commission has extended EFRAG’s deadline for delivering final technical advice to the end of November 2025. Once adopted, the standards will be applied across the EU and will influence sustainability reporting practices globally, including in Africa.
Patrick de Cambourg, Chair of the EFRAG Sustainability Reporting Board, said the changes aim to create “a more focused, more usable sustainability reporting system that remains ambitious but does not overburden companies.” For Africa, where many businesses are navigating both domestic ESG requirements and international reporting obligations, the revisions could make compliance more manageable while preserving the strategic importance of sustainability data in securing investment and maintaining export relationships.
