Integrating ESRS into Corporate Strategy

Integrating the ESRS into corporate strategy means incorporating the European Sustainability Reporting Standards (ESRS) not as a mere compliance formality, but as a management tool that guides decisions, prioritises resources and strengthens competitiveness. Instead of reporting at the end of the year, the company uses the ESRS to steer its sustainability strategy throughout the year.

What are the ESRS?

The ESRS are the set of standards developed by the European Union to standardise how companies report on their environmental, social and governance (ESG) performance. They form part of the Corporate Sustainability Reporting Directive (CSRD), which repealed and replaced the former Non-Financial Reporting Directive (NFRD).

The ESRS revision in 2026

Following the Omnibus simplification package, the European Commission adopted the delegated act with the revised ESRS on 3 July 2026, informally known as ESRS 2.0. The key points are:

• A cut of more than 60% of mandatory data points and of more than 70% of all data points, with voluntary disclosures removed.
• A more flexible materiality assessment, based on a top-down approach that starts from management's view.
• Application to financial years beginning on or after 1 January 2027, with early adoption possible for financial year 2026.
• Double materiality and climate change (ESRS E1) are retained as the cornerstones of the system.

On the same day the Commission adopted the voluntary standard for companies outside the scope, based on the VSME, which also caps the information that can be requested from value chain companies. In addition, Directive (EU) 2026/470 raised the CSRD thresholds: the directive now applies to companies with more than 1,000 employees and more than EUR 450 million in net turnover, with the first reports covering financial years beginning on or after 1 January 2027.

The ESRS and the carbon footprint

Measuring the carbon footprint is a central component of the ESRS. The standard requires disclosure of greenhouse gas (GHG) emissions across the three scopes:

• Scope 1: direct emissions from sources owned or controlled by the company.
• Scope 2: indirect emissions associated with purchased energy.
• Scope 3: other indirect emissions throughout the value chain.

How to integrate the ESRS into strategy, step by step

1. Understand the context

• Identify the ESRS relevant to the sector and business model.
• Conduct the materiality analysis, the mandatory first step that determines what to report on.

2. Set targets

• Define SMART objectives (specific, measurable, achievable, relevant and time-bound) for each priority area.
• Align them with the Sustainable Development Goals (SDGs).

3. Implement and manage data

• Implement robust systems for collecting, managing and analysing sustainability information.
• Leverage digital tools that automate calculation and improve reliability.

4. Communicate and report

• Prepare a clear sustainability report that complies with the ESRS.
• Communicate performance to stakeholders regularly and transparently.

Benefits of integrating the ESRS

• Better risk management: identifies sustainability risks and opportunities before they materialise.
• Access to finance: attracts socially responsible investment (SRI) and new sources of capital.
• Reputation and competitive advantage: positions the company as a benchmark and strengthens its brand image.
• Innovation: drives products and services with a lower environmental impact.

At Manglai we help companies measure their carbon footprint and prepare their sustainability information in compliance with the ESRS, so that reporting becomes a strategic lever rather than a burden. Discover Manglai's carbon footprint software.