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London Reporting Academy ESRS E1 · Climate Change · Disclosure Requirement E1-2

Applicable from FY2027

This revised ESRS edition applies from reporting year 2027. For reporting years 2024–2026, use the ESRS 2023 edition.

Identification of climate-related risks and scenario analysis

E1-2 · mandatory · narrative disclosure

E1-2 explains how the undertaking identifies and assesses climate-related risks and opportunities for financial materiality. It covers physical and transition risks, opportunities, the assessment process and relevant time horizons.

Start preparing ↓ Official European Commission source ↗

Disclosure focus

The resilience of strategy and business model is reported under E1-3. E1-2 supplies inputs to that analysis but does not itself require the resilience conclusion or its strategic consequences.

Climate-related scenario analysis is disclosed when it is used. The standard does not require every undertaking to use a prescribed 1.5°C and high-emissions pair or a fixed scenario set.

This LRA educational guidance supports disclosure preparation. For the exact requirements, always refer to the official European Commission source.

Prepare

What to collect before drafting

Tick each field as the evidence lands. Owners are the teams that usually hold the source files.

  • Identification process

    Sustainability reporting

    Describe how climate-related physical and transition risks and opportunities are identified.

    Evidence Dated source records, governance papers and approval evidence supporting identification process.

    Watch for The published response for identification process is incomplete or does not match the supporting records.

  • Assessment methodology

    Sustainability reporting / Finance

    Describe how likelihood, magnitude and duration are assessed for financial materiality.

    Evidence Dated source records, governance papers and approval evidence supporting assessment methodology.

    Watch for The published response for assessment methodology is incomplete or does not match the supporting records.

  • Physical risks

    Sustainability reporting / Operations

    Describe identified physical risks, including relevant hazards, locations, assets and business dependencies.

    Evidence Dated source records, governance papers and approval evidence supporting physical risks.

    Watch for The published response for physical risks is incomplete or does not match the supporting records.

  • Transition risks

    Sustainability reporting

    Describe identified transition risks and their drivers.

    Evidence Dated source records, governance papers and approval evidence supporting transition risks.

    Watch for The published response for transition risks is incomplete or does not match the supporting records.

  • Climate-related opportunities

    Sustainability reporting

    Describe identified climate-related opportunities.

    Evidence Dated source records, governance papers and approval evidence supporting climate-related opportunities.

    Watch for The published response for climate-related opportunities is incomplete or does not match the supporting records.

  • Time horizons

    Sustainability reporting / Finance

    State the short-, medium- and long-term horizons used and how they relate to strategic and financial planning.

    Evidence Dated source records, governance papers and approval evidence supporting time horizons.

    Watch for The published response for time horizons is incomplete or does not match the supporting records.

  • Scenario analysis used

    Sustainability reporting

    If scenario analysis is used, describe scenarios, assumptions, ranges and time horizons relevant to the assessment.

    Evidence Dated source records, governance papers and approval evidence supporting scenario analysis used.

    Watch for The published response for scenario analysis used is incomplete or does not match the supporting records.

  • Scope and coverage

    Sustainability reporting

    Explain the coverage of own operations, assets and business dependencies and any justified limitations.

    Evidence Dated source records, governance papers and approval evidence supporting scope and coverage.

    Watch for The published response for scope and coverage is incomplete or does not match the supporting records.

Before you start

  • Assess climate-related risks and opportunities for financial materiality across the applicable reporting boundary.
  • Scenario-analysis details are required only if scenario analysis is used; resilience conclusions belong to E1-3.
  • Have the supporting records and the final response been reconciled?
＋ Show E1-2 sub-elements (LRA working checklist)

How to prepare it

Assess climate-related risks and opportunities for financial materiality across the applicable reporting boundary.
Collect and reconcile the records for: Identification process; Assessment methodology; Physical risks; Transition risks; Climate-related opportunities; Time horizons; Scenario analysis used; Scope and coverage.
Scenario-analysis details are required only if scenario analysis is used; resilience conclusions belong to E1-3.
Draft the response using the defined terms shown in the disclosure focus; do not substitute broader internal labels.
Review the final wording against every requirement and the supporting governance or data records before sign-off.

Request the data

Request the disclosure evidence

Translate the disclosure into an internal business question — then adapt it to your organisation's own language.

Provide the climate risk and opportunity register, financial-materiality methodology, hazard and location analysis, time horizons, scope reconciliation and scenario documentation where used.

Use the organisation's own role and document names, but preserve the defined ESRS terms and the scope described above.

Better request

Provide the climate risk and opportunity register, financial-materiality methodology, hazard and location analysis, time horizons, scope reconciliation and scenario documentation where used.

Draft your disclosure

Notes that turn data into a disclosure

LRA training templates — adapt them to your organisation, and check the official source before sign-off.

Method note

Test likelihood, magnitude and duration and document how physical locations, assets and business dependencies were considered.

Context note

A location or activity cannot be excluded merely because it was absent from the assessment; explain the applicable boundary or ESRS relief.

Download Centre

Preparation tools & forms

Download preparation tools for E1-2 with free verified email access for 24 hours. Source-report links remain public.

Free · Email access
01XLSPrep & Assurance workbookDatapoints, risks, evidence to check, owner and evidence pack.Get it free ↧ 02XLSData-request packRequest email, message template, response fields and sign-off structure.Get it free ↧ 03PDFLibrary CardPrintable one-page summary of this disclosure card.Get it free ↧

Check

For each claim, check the evidence

  • Identification process is reported accurately and completely.

    Risk The response omits, misclassifies or overstates identification process.

    Evidence to check Dated source records, governance papers and approval evidence supporting identification process.

  • Assessment methodology is reported accurately and completely.

    Risk The response omits, misclassifies or overstates assessment methodology.

    Evidence to check Dated source records, governance papers and approval evidence supporting assessment methodology.

  • Physical risks is reported accurately and completely.

    Risk The response omits, misclassifies or overstates physical risks.

    Evidence to check Dated source records, governance papers and approval evidence supporting physical risks.

  • Transition risks is reported accurately and completely.

    Risk The response omits, misclassifies or overstates transition risks.

    Evidence to check Dated source records, governance papers and approval evidence supporting transition risks.

  • Climate-related opportunities is reported accurately and completely.

    Risk The response omits, misclassifies or overstates climate-related opportunities.

    Evidence to check Dated source records, governance papers and approval evidence supporting climate-related opportunities.

  • Time horizons is reported accurately and completely.

    Risk The response omits, misclassifies or overstates time horizons.

    Evidence to check Dated source records, governance papers and approval evidence supporting time horizons.

  • Scenario analysis used is reported accurately and completely.

    Risk The response omits, misclassifies or overstates scenario analysis used.

    Evidence to check Dated source records, governance papers and approval evidence supporting scenario analysis used.

  • Scope and coverage is reported accurately and completely.

    Risk The response omits, misclassifies or overstates scope and coverage.

    Evidence to check Dated source records, governance papers and approval evidence supporting scope and coverage.

Evidence pack to prepare

Common reporting gaps

  • Omitting opportunities or financial materiality.
  • Reporting E1-3 resilience conclusions as E1-2.
  • Presenting scenario analysis as universally mandatory.
  • Using a fixed scenario pair as an ESRS rule.
  • Treating internal boundary choices as automatic exclusions.
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Framework references

Relevant ESRS requirements and related disclosures

ESRS

E1-2

within ESRS E1: Climate Change

Open official source →

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How this library is built 1,211 published reports indexed 315,012 pages with page-level citations 272 published cards in the active catalogue
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