ESRS Reform: fewer mandatory disclosures, but no real relief

In a recent statement, the German Insurance Association (GDV) criticised that the intended reduction in bureaucracy falls short of expectations. “The insurance industry fully supports the objectives of sustainability reporting. But for the standards to be truly effective and to drive the transformation, they must be more practice-oriented and less complex,” said GDV CEO Jörg Asmussen.

Seizing the opportunity for an effective regulatory framework

With the planned reduction of data points to be reported by 57 percent, the new ESRS draft does contain noticeable progress. However, many new requirements, ambiguities, and additional mandatory indicators undermine the intended relief. From the GDV’s perspective, a consistent, practical, and streamlined framework is essential for sustainability reports to deliver real added value for investors, supervisors, and society.

Among other things, insurers are calling for investments held exclusively for investment purposes not to be considered part of their core business activities. Such an interpretation would create disproportionate effort without generating meaningful insights into the core business. Moreover, clear guidance is needed on when companies may omit certain disclosures, for example, if they provide no relevant informational value. As currently foreseen, companies would in practice have to report on almost everything, even if some points deliver little to no additional insight.

In some areas, the ESRS revision also introduces new mandatory indicators. This runs counter to the goal of simplifying reporting requirements. Content overlaps and contradictions with existing obligations such as Solvency II should also be resolved.

Final ESRS recommendation planned by end of November 2025

The planned deadline for the final recommendation on the ESRS revision by the end of November 2025 is part of the official review process of the European Sustainability Reporting Standards. Following the public consultation, EFRAG will evaluate all feedback and prepare a revised version. The final recommendation will then be submitted to the European Commission, which will decide whether and how the revised ESRS will be implemented through a delegated act.