Free GRI ESRS Professional Certification Exam ESRS-Professional Exam Questions

Under ESRS 2 (Appendix F of ESRS 1), sustainability statements must follow a structured disclosure approach. The appendix provides guidance on the recommended format and elements to be included in the sustainability statement to ensure consistency, comparability, and transparency.

Key Requirements for ESRS 2 Sustainability Statement

(C) A list of Disclosure Requirements that have been complied with:

Organizations must provide a clear list of all ESRS disclosure requirements that they have reported on. This ensures that stakeholders can assess whether the company has complied with its materiality-based reporting obligations.

The list must include page numbers or references to the exact location of disclosures within the report.

Incorrect Options

(A) A specific structure prescribed by the ESRS:

While ESRS 1 provides a recommended structure, it is not mandatory. Instead, companies are given flexibility to adapt the format to their reporting needs.

(B) Only sector-specific Disclosure Requirements:

The sustainability statement should cover both general ESRS disclosures and sector-specific disclosures, not just sector-specific ones.

(D) A table summarizing financial performance:

Financial performance is not a core requirement of the sustainability statement. Instead, ESRS focuses on sustainability-related disclosures that impact financial performance but does not mandate a direct financial summary within the sustainability statement.

Official Reference:

Commission Delegated Regulation (EU) 2023/2772, ESRS 2 (Appendix F of ESRS 1) -- Outlines the format and elements of the sustainability statement.

EFRAG Compilation Explanations (January -- November 2024) -- Provides insights into structuring sustainability statements under ESRS.

Thus, the correct answer is C. A list of Disclosure Requirements that have been complied with.

The goal of assurance in sustainability reporting is to confirm the reliability of sustainability disclosures, ensuring that reported information on risks, management strategies, and performance data is accurate and verifiable.

Key aspects of sustainability assurance include:

Evaluating the credibility of reported sustainability risks and how organizations manage them.

Assessing compliance with CSRD and ESRS assurance requirements.

Ensuring data integrity and alignment with financial and sustainability disclosures.

Enhancing investor confidence in an organization's sustainability reporting.

Official Reference:

CSRD and ESRS Assurance Requirements (Commission Delegated Regulation (EU) 2023/2772, Section 5.2) - Specifies assurance requirements for sustainability reporting.

EU Sustainable Finance Platform Report (2025) - Confirms assurance processes are necessary to enhance trust in sustainability data.

The Corporate Sustainability Reporting Directive (CSRD) replaced the Non-Financial Reporting Directive (NFRD) to address its limitations in scope and reporting requirements. Below are the explanations for each option:

A . False -- The NFRD did not require all companies in the EU to include a non-financial statement. Instead, it applied only to large public-interest entities with 500 or more employees.

B . True -- The NFRD applied to large public-interest entities, including listed companies, banks, and insurance firms with more than 500 employees.

C . False -- The NFRD did not mandate external assurance for sustainability information. The CSRD introduced mandatory assurance at the EU level.

D . False -- The CSRD did not replace the NFRD; rather, it expanded and strengthened reporting requirements. The NFRD was replaced by the CSRD, but not the other way around.

E . True -- The CSRD was introduced to improve the scope and depth of sustainability reporting compared to the NFRD. It expanded the number of entities required to report, standardized disclosures via ESRS, and introduced third-party assurance requirements.

Key Differences Between CSRD and NFRD

Feature

NFRD (Old Directive)

CSRD (New Directive)

Scope

Large public-interest entities (500+ employees)

All large companies + listed SMEs

Assurance

Not required

Mandatory external assurance

Disclosure Requirements

Limited sustainability disclosures

Comprehensive ESRS-based reporting

Reporting Standards

No standardized framework

ESRS-based mandatory framework

Application Date

In force since 2018

Applies from 2024 onwards

Official Reference:

CSRD Directive (EU) 2022/2464 -- Assurance & Reporting Provisions.

ESRS Compilation Explanations January - November 2024.

Incorporation by reference in sustainability statements under ESRS must adhere to specific principles to ensure transparency, accessibility, and alignment with financial and regulatory reporting. The key principles are:

(A) The referenced information must be clearly identified in the original document.

ESRS mandates that referenced disclosures must be explicitly identified in the original document to prevent ambiguity and ensure clear linkage to the sustainability statement.

(C) It must comply with digitalization requirements.

The referenced data must meet the same technical digitalization standards as the sustainability statement to ensure consistency and usability across digital platforms.

(D) It must meet the same level of assurance as the sustainability statement.

Any information incorporated by reference must be subject to at least the same level of assurance as the sustainability statement itself, ensuring reliability and accuracy.

Incorrect Option:

(B) It can be published later than the management report.

ESRS does not allow referenced information to be published after the management report. It must be available at the same time or earlier to maintain the coherence of disclosures.

Official Reference:

Commission Delegated Regulation (EU) 2023/2772, ESRS 1, Section 9.1 -- Defines the principles of incorporation by reference.

EFRAG Compilation Explanations (January - July 2024) -- Provides guidance on referenced information's role in digital and assurance compliance.

Thus, the correct answers are A, C, and D.

According to the European Sustainability Reporting Standards (ESRS) under the Commission Delegated Regulation (EU) 2023/2772, stakeholders are defined as individuals or groups who can affect or be affected by the undertaking. The ESRS distinguishes between two main groups of stakeholders:

Affected stakeholders: These are individuals or groups whose interests are affected or could be affected -- positively or negatively -- by the undertaking's activities and its direct and indirect business relationships across its value chain.

Users of sustainability statements: These include primary users of general-purpose financial reporting (e.g., existing and potential investors, lenders, and other creditors such as asset managers, credit institutions, and insurance undertakings) and other users, including the undertaking's business partners, trade unions, social partners, civil society and non-governmental organizations, governments, analysts, and academics.

Furthermore, engagement with affected stakeholders is a crucial aspect of the undertaking's ongoing due diligence process and sustainability materiality assessment. This involves identifying and assessing actual and potential negative impacts to inform the materiality assessment process for sustainability reporting.

Official Reference:

Commission Delegated Regulation (EU) 2023/2772 of 31 July 2023 supplementing Directive 2013/34/EU on sustainability reporting standards.

ESRS 1: General Requirements, Section 3.1 (Stakeholders and their relevance to the materiality assessment process).

The sustainability statement under ESRS is structured according to ESRS 1 and ESRS 2, outlining specific disclosure requirements. The required disclosures include:

General Disclosure Requirements from ESRS 2

ESRS 2 outlines general disclosure requirements, including governance, strategy, and impact, risk, and opportunity management (IROs). These disclosures are mandatory for all undertakings, providing the foundation of the sustainability statement.

(A) is correct

Environmental Objectives under the EU Taxonomy Regulation

Companies must disclose their alignment with the EU Taxonomy Regulation, particularly under Article 8 of Regulation (EU) 2020/852, which includes financial and non-financial companies' obligations regarding taxonomy-aligned activities.

(B) is correct

Financial Performance Metrics from IFRS Reports

Financial metrics from IFRS are NOT a required disclosure under ESRS. The sustainability statement focuses on non-financial reporting, while financial performance remains under IFRS standards in financial statements.

(C) is incorrect

Governance-Related Information Determined by the Materiality Assessment

Governance disclosures (ESRS G1 Business Conduct) include transparency about policies, risk management, and ethical business practices. The materiality assessment determines the necessary governance disclosures based on entity-specific risks and opportunities.

(D) is correct

Conclusion:

The sustainability statement must include general disclosure requirements (A), environmental objectives under the EU Taxonomy (B), and governance-related information based on materiality (D). Financial performance metrics from IFRS reports (C) are not required.

Official Reference:

Commission Delegated Regulation (EU) 2023/2772

Compilation Explanations January - July 2024