ESRS 2 General Disclosures
ESRS 2 is mandatory for every company in CSRD scope — regardless of materiality. It covers governance, strategy, stakeholder engagement and risk management. No company can exclude ESRS 2 disclosures.
ESRS 2 is mandatory for every company in CSRD scope — regardless of materiality. ESRS 2 covers seven disclosure areas: GOV (Governance) — board oversight and management roles; SBM (Strategy and Business Model) — value chain, stakeholders, and business model; IRO (Impacts, Risks and Opportunities) — identification and assessment processes; BP (Basis for Preparation) — methodology and reporting boundary.
The seven disclosure areas of ESRS 2
ESRS 2 covers seven disclosure areas: GOV (Governance) — board oversight and management roles; SBM (Strategy and Business Model) — value chain, stakeholders, and business model; IRO (Impacts, Risks and Opportunities) — identification and assessment processes; BP (Basis for Preparation) — methodology and reporting boundary.
The GOV disclosures require you to describe how your board oversees sustainability matters, how management roles are structured, and how incentive schemes are linked to sustainability performance.
SBM-1 requires a description of your business model and value chain — this is often more work than expected for complex multinational groups.
GOV-1 and GOV-2 — board and management
GOV-1 requires disclosure of the governance body or bodies responsible for sustainability — who on the board has oversight, how often they receive sustainability information, and what their expertise is.
GOV-2 requires disclosure of management's role — what processes exist to provide the board with information, how management monitors sustainability performance, and whether sustainability expertise is built into management appointments.
GOV-4 requires disclosure of due diligence — how sustainability matters are integrated into your risk management and oversight processes.
SBM-3 — material IROs
SBM-3 is one of the most important disclosures in ESRS 2. It requires you to disclose your material impacts, risks and opportunities — the output of your double materiality assessment.
For each material topic, SBM-3 requires: a description of the impact, risk or opportunity; whether it is actual or potential; the time horizon; how it connects to your business model and strategy; and how it is managed.
SBM-3 effectively summarises your entire double materiality assessment in a structured disclosure. Assurers pay close attention to the consistency between SBM-3 and the topical standard disclosures.
Frequently asked questions
Can we exclude any ESRS 2 disclosures?
No. ESRS 2 is mandatory in full for all CSRD companies. However, some datapoints within ESRS 2 are subject to transitional reliefs in early reporting years — check the EFRAG transitional provisions.
How much of our ESRS 2 disclosure overlaps with our annual report?
Significant overlap — governance structures, business model descriptions, and risk management processes are already disclosed in annual reports. The key difference is the sustainability-specific framing and ESRS-specific requirements for each datapoint.
Does ESRS 2 change under the Amended ESRS?
Yes — the Amended ESRS (December 2025) reduced the number of mandatory ESRS 2 datapoints. Wave 2 companies reporting under Amended ESRS from FY2027 have fewer mandatory ESRS 2 disclosures than Wave 1 companies.