ESRS – European Sustainability Reporting Standards

Contents

Overview and origin
2.1. Disclosure requirements by code
2.2. Double materiality
2.3. Main 2026 changes
2.4. The VSME standard for smaller companies
Users and how to apply it
Practical example
Notes for use in Vietnam

Overview and origin

Item	Details
Vietnamese name	Bộ Chuẩn mực Báo cáo Bền vững châu Âu
English name	European Sustainability Reporting Standards (ESRS)
Issuer/custodian	European Commission, by delegated act, based on technical advice from EFRAG; implements the Corporate Sustainability Reporting Directive (CSRD).
Nature	Mandatory standards for companies in CSRD scope; apply double materiality; reported in the management report, digitally tagged and subject to limited assurance.
Reference scope	After Omnibus I: EU companies with more than 1,000 employees and over €450 million turnover; non-EU parents with over €450 million EU turnover and an EU subsidiary or branch above €200 million.

The first ESRS set (Set 1) of 12 standards was adopted in July 2023 and applied from FY2024 to “wave one”. In 2025–2026 the EU carried out the Omnibus simplification: “stop-the-clock” delays, narrower CSRD and CSDDD scope through Directive (EU) 2026/470, in force from 18 March 2026 (CSRD transposition by 19 March 2027), and removal of the CSDDD climate transition plan obligation. On 3 July 2026 the revised ESRS were adopted, mandatory from FY2027.

ESRS – Chuẩn báo cáo bền vững châu Âu · Ảnh: FTS CSRA

Purpose and main structure

Purpose: produce comparable, reliable sustainability information for investors and stakeholders, on a par with financial reporting. The architecture has 2 cross-cutting standards and 10 topical standards (5 environmental, 4 social, 1 governance); sector-specific standards have been postponed indefinitely.

Figure 1. The 12-standard ESRS architecture: two cross-cutting and ten topical standards. (AI-generated image) / Hình 1. The 12-standard ESRS architecture: two cross-cutting and ten topical standards. (Ảnh do AI tạo)

2.1. Disclosure requirements by code

The table lists the disclosure requirements (DRs) of ESRS Set 1 (2023) – the basis for understanding the content. The 2026 revised ESRS keep the topical architecture but sharply cut datapoints and merge some requirements; companies should check the official text when reporting from 2027.

Standard	DR codes	Disclosure requirements (ESRS Set 1, 2023)
ESRS 2	BP-1, BP-2	Basis for preparation; disclosures in relation to specific circumstances (consolidation, value chain, estimates, errors)
ESRS 2	GOV-1 → GOV-5	Role of governance bodies; information provided to them; sustainability in incentive schemes; statement on due diligence; risk management and internal controls over reporting
ESRS 2	SBM-1 → SBM-3	Strategy, business model and value chain; interests and views of stakeholders; material impacts, risks and opportunities and their interaction with strategy
ESRS 2	IRO-1, IRO-2	Process to identify and assess material IROs; disclosure requirements covered
ESRS 2	MDR-P, A, M, T	Minimum disclosure requirements for any topic: policies, actions, metrics, targets
E1 Climate	E1-1 → E1-4	Transition plan for climate mitigation; policies; actions and resources; targets
E1 Climate	E1-5	Energy consumption and mix (fossil, nuclear, renewable); energy intensity in high climate impact sectors
E1 Climate	E1-6	Gross Scope 1, 2 (location- and market-based), 3 and total GHG emissions; GHG intensity per net revenue
E1 Climate	E1-7 → E1-9	GHG removals and mitigation financed through carbon credits; internal carbon pricing; anticipated financial effects
E2 Pollution	E2-1 → E2-6	Policies; actions; targets; pollution of air, water and soil; substances of concern and SVHCs; anticipated financial effects
E3 Water and marine	E3-1 → E3-5	Policies; actions; targets; water consumption (total, in water-risk areas, recycled, stored, intensity); anticipated financial effects
E4 Biodiversity	E4-1 → E4-6	Transition plan and biodiversity in strategy; policies; actions; targets; impact metrics (sites near sensitive areas, land-use change, threatened species); financial effects
E5 Circular economy	E5-1 → E5-6	Policies; actions; targets; resource inflows (materials, recycled share, sustainable biological); outflows (circular products, waste by type and treatment); financial effects
S1 Own workforce	S1-1 → S1-5	Policies; engagement with workers and representatives; remediation channels; actions; targets
S1 Own workforce	S1-6 → S1-9	Employee characteristics (gender, country, contract type, turnover); non-employees; collective bargaining coverage and social dialogue; diversity (gender in top management, age)
S1 Own workforce	S1-10 → S1-13	Adequate wages; social protection; persons with disabilities; training and skills (average training hours, share with performance reviews)
S1 Own workforce	S1-14 → S1-17	Health and safety (coverage, fatalities, recordable accidents, days lost); work-life balance; remuneration (gender pay gap, total remuneration ratio); incidents, complaints and severe human rights impacts
S2 Value chain workers	S2-1 → S2-5	Policies; engagement; grievance channels; actions on material impacts (forced and child labour, safety, wages); targets
S3 Affected communities	S3-1 → S3-5	Policies; engagement; grievance channels; actions (land, water, security, indigenous peoples, FPIC); targets
S4 Consumers and end-users	S4-1 → S4-5	Policies; engagement; grievance channels; actions (privacy, product safety, responsible marketing, access); targets
G1 Business conduct	G1-1 → G1-6	Business conduct policies, corporate culture, whistleblower protection; supplier relationships; prevention of corruption and bribery; confirmed incidents; political influence and lobbying; payment practices (average days, share paid on time)

2.2. Double materiality

A topic is reported if it is material from at least one perspective: (1) impact materiality – the company has significant actual or potential, positive or negative impacts on people or the environment, assessed by scale, scope, irremediability and likelihood; (2) financial materiality – the sustainability matter creates risks or opportunities that significantly affect cash flows, performance, position or cost of capital. ESRS 2 is mandatory for all; topical standards apply only where material.

Figure 2. Double materiality: impact materiality and financial materiality. (AI-generated image) / Hình 2. Double materiality: impact materiality and financial materiality. (Ảnh do AI tạo)

2.3. Main 2026 changes

Area	Change
Mandatory datapoints	Down by more than 60%; total datapoints down by over 70%; compliance cost estimated down by over 30%
Double materiality assessment	Top-down, starting from business model and strategy; less item-by-item documentation
Fair presentation	Applies to the sustainability statement as a whole rather than each datapoint
Reliefs	Omission of seriously prejudicial information; undue cost or effort relief; value-chain cap based on VSME for smaller partners
Climate	GHG boundary by financial or operational control; incompatibility with 1.5°C must be disclosed
Phase-in	Mandatory from FY2027; optional early application for FY2026. Wave-one deferrals: E4, S2–S4 to FY2027; SVHC to FY2028; quantitative financial effects and E2-5 to FY2030

2.4. The VSME standard for smaller companies

The voluntary VSME standard has a Basic Module (B1–B11: basis for preparation, transition practices, energy and GHG, pollution, biodiversity, water, resources and waste, workforce characteristics, health and safety, remuneration and collective bargaining, training, corruption) and a Comprehensive Module (C1–C9). After Omnibus, VSME is the upper limit of information large companies may request from small value-chain partners – highly relevant for Vietnamese suppliers.

Users and how to apply it

Users in Vietnam: subsidiaries of EU groups; Vietnamese companies with EU subsidiaries or branches above the thresholds; suppliers to EU groups (indirectly, through value-chain data requests); banks with EU clients or shareholders.

Determine whether the company is directly in scope (new Omnibus thresholds) or only a value-chain partner.
If a supplier: prepare a data set following the VSME Basic Module (energy, Scope 1–2 GHG, water, waste, workforce, safety, corruption).
If in scope: run a double materiality assessment and list impacts, risks and opportunities (IRO-1).
Map disclosure requirements against available data; prioritise ESRS 2 and E1 (climate), usually material.
Build internal controls over sustainability data to prepare for limited assurance.

Practical example

Hypothetical case: Furniture company G (Bình Định, 2,500 workers) exports 60% to the EU; its retail customer, in CSRD scope, requests data.

Customer request	Data G provides	Reference
Product GHG emissions	Scopes 1, 2 under the GHG Protocol; intensity tCO₂e/m³ of timber	ESRS E1-6, VSME B3
Timber origin, deforestation-free	Share of FSC timber, traceability documents, harvest coordinates	ESRS E4, EUDR
Working conditions	Hours, wages vs regional minimum wage, accidents	ESRS S2 (customer's), VSME B8–B10
Anti-corruption	Policy, number of incidents	ESRS G1, VSME B11

Notes for use in Vietnam

Not mandatory under Vietnamese law, but it reaches Vietnam through value chains and related rules such as CBAM, EUDR and CSDDD.
Don't over-prepare: after Omnibus, EU customers may not request more than the VSME limit from small partners, except common sector information; suppliers can negotiate.
Interaction with ISSB: ESRS and IFRS S1/S2 are highly interoperable on climate; one data set can serve both.
Cross-check Circular 96/2020/TT-BTC: listed companies in Vietnam still disclose environmental and social information under domestic rules and can use ESRS to raise quality.