Simplified ESRS 2026: what changes with the new version of the standards
Mandatory data points cut by 61%, leaner double materiality and application from the 2027 financial year: what is new in the ESRS adopted by the Commission on 3 July 2026.
The simplified ESRS are the new version of the European Sustainability Reporting Standards, adopted by the Commission on 3 July 2026. According to EFRAG they cut mandatory data points by 61%, they simplify double materiality and they apply from the 2027 financial year, with the option to use them as early as 2026. They concern large companies within the CSRD scope, but they also change the requests that reach SMEs.
What the ESRS are
The ESRS (European Sustainability Reporting Standards) are the standards that companies subject to the CSRD use to prepare their sustainability reporting. The first version, adopted in 2023, included two cross-cutting standards and ten topical ones: five environmental, four social and one on business conduct.
First-wave companies applied them to the 2024 financial year. Experience confirmed what many had feared: hundreds of data points, rules that were hard to interpret and high costs, especially for groups applying them for the first time.
Why they were simplified
The revision stems from the Omnibus package presented by the Commission in February 2025 to reduce administrative burden. The main milestones:
- December 2025: EFRAG delivers its technical advice to the Commission, with the drafts of the simplified standards;
- 6 May 2026: the Commission publishes the draft delegated act and opens four weeks for comments;
- 3 July 2026: the Commission adopts the final delegated act, which goes to Parliament and Council for scrutiny for two months, extendable by another two.
On the same day the Commission also adopted the voluntary standard for SMEs derived from the VSME, which becomes the limit on data requests along the value chain.
The main changes
- Fewer data points: according to EFRAG, mandatory ones drop by 61% and voluntary data points are removed.
- Leaner double materiality: the analysis can start top-down, from the topics most likely for the sector, using reasonable information available without undue cost or effort. To understand the method, read the guide on double materiality.
- Defined value chain: metrics can cover only an objectively defined part of the value chain, without chasing every supplier.
- More time on financial effects: first-wave companies can omit quantitative information on anticipated financial effects until 2029.
- Clearer texts: a reorganised structure, simplified cross-cutting requirements and closer alignment with international standards.
- No mandatory sector standards: with the Omnibus, the obligation to develop sector-specific standards is dropped.
ESRS 2023 and ESRS 2026 compared
| Aspect | ESRS 2023 | ESRS 2026 |
|---|---|---|
| Data points | Many mandatory, plus voluntary ones | Mandatory cut by 61%, voluntary removed |
| Double materiality | Detailed topic-by-topic analysis | Top-down approach, information without undue cost or effort |
| Value chain | Broad coverage expected | Objectively defined part |
| Application | From the 2024 financial year for the first wave | From the 2027 financial year, optional for 2026 |
Application dates
The simplified ESRS are mandatory for financial years starting on or after 1 January 2027. For the 2026 financial year there is a transitional period: companies can apply the 2023 standards, the new ones or a combination of the two.
Who must apply them is set by the new CSRD scope: after the Omnibus, only companies with more than 1,000 employees and more than €450 million in turnover are required to report. The details are in the guide on CSRD and the Omnibus.
What changes for SMEs
An SME does not apply the ESRS, but it feels their effects. Large companies in scope must collect data from their suppliers, and with the simplified standards their requests become more targeted: fewer data points, more focus on emissions, energy, waste and working conditions.
At the same time, the value chain cap means that a company with fewer than 1,000 employees cannot be asked for information beyond what the voluntary standard provides. In practice, an up-to-date VSME report answers almost every request: you can see what it contains in the guide to the VSME in 2026.
How to prepare
- If you are in CSRD scope, consider adopting the ESRS 2026 early for the 2026 financial year: fewer data points mean less work straight away.
- Review your double materiality assessment in light of the top-down approach, documenting the choices you make.
- Limit requests to suppliers to the scope of the VSME, so you get faster and more comparable answers.
- If you are a supplier, prepare the VSME Basic module with data on energy, emissions, waste, water and workforce.
The ESRS 2026 cut mandatory data points by 61%, simplify double materiality and become mandatory from the 2027 financial year. SMEs do not apply them directly, but they receive more targeted requests, protected by the VSME cap: having that data ready is the most efficient response.
