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Level 2 · Decision guide·ESRS · Disclosure guides

How to Prepare an ESRS Sustainability Statement: Complete Step-by-Step Guide

Scope, governance, double materiality, the IRO register, disclosure architecture, data, controls, assurance and publication

Who this is for A 10-minute read for reporting teams working through Running the reporting cycle: governance, data and controls, and for reviewers testing whether the evidence behind it holds.

Published passport

Current as at 10 August 2026
RK Reviewed by Dr Ross KurinkoLinkedIn Strategic ESG Advisor · IFRS S1 & S2 / GRI / ESRS expert GRI Certified Global Trainer · PhD, University of Cambridge · ESG-AI expert 15+ years on FTSE 100 & Fortune Global 500 disclosures Canary Wharf, London LRA educational guidance · Not issued or endorsed by European Commission

Edition written against

ESRS (August 2026)

source check 2 August 2026

Published

10 Aug 2026

Knowledge Hub guide

Last reviewed

10 Aug 2026

Short answer

The answer, before the reasoning

Preparing an ESRS sustainability statement is a controlled reporting programme, not a late-stage writing exercise. The undertaking first locks the legal scope, reporting entity, reporting period and applicable ESRS version.

It then establishes governance; maps the business model, geographies and value chain; performs the double materiality assessment; maintains an impact, risk and opportunity (IRO) register; converts material IROs into a disclosure matrix; collects controlled data and evidence; drafts connected narrative and metrics; runs internal controls and assurance-readiness procedures; obtains governance approval; and publishes a clearly identifiable sustainability statement in the management report. A realistic first implementation commonly needs 12-18 months, although timing depends on reporting maturity and data readiness.

Rule

KNOWLEDGE CARD PACKAGE

<p>Public practitioner article followed by an editor and publisher pack with SEO, mapping, sources, update triggers and review flags.</p>

Rule

ESRS-IMP-001

<p>How to Prepare an ESRS Sustainability Statement: Complete Step-by-Step Guide Scope, governance, double materiality, the IRO register, disclosure architecture, data, controls, assurance and publication</p>

In practice

Type

Type Tier Audience — Current context
End-to-end ESRS reporting implementation guide Tier 4 · Deep How-to Guide Cross-functional ESRS programme teams, executives and assurance functions — Revised ESRS adopted 3 July 2026; version and legal-status gate checked to 2 August 2026

Rule

2026 VERSION GATE

<p>The European Commission adopted revised ESRS on 3 July 2026. At the source-check date, the delegated act was not yet in force because publication in the Official Journal follows the European Parliament and Council scrutiny period. The 2023 ESRS therefore remained the legally applicable set. Every project should identify the ESRS applicable at the end of its reporting period and control any transition or optional early-use decision. The articles below explain the revised text while retaining this legal-status limitation.</p>

Why this question matters

A sustainability statement can fail even when individual numbers are correct. The more common first-year weaknesses are unresolved scope, a materiality process that does not connect to the disclosure matrix, unsupported narrative claims, data collected without definitions, inconsistent boundaries between metrics, late governance involvement and assurance evidence assembled after drafting. These weaknesses create rework because the statement is the final output of a reporting system, not the system itself.

The revised ESRS place double materiality, fair presentation and information materiality at the centre of reporting. They also require the statement to be clearly identifiable within the management report, to use the same reporting undertaking as the financial statements subject to specified boundary rules, and to explain the basis of preparation, value-chain coverage, reliefs and significant judgements. A strong project therefore starts with legal and reporting architecture before it starts collecting datapoints.

Quick orientation

Quick orientation

Applies to
First-time reporters, entities redesigning a 2023 ESRS process and groups preparing for assurance or a new reporting perimeter.
Primary decision
How to organise the programme so that materiality, data, narrative, controls and publication form one traceable process.
Key sources
Revised ESRS 1 Chapters 2-3, 5-9; revised ESRS 2 BP, GOV, SBM and IRO disclosures.
Common confusion
Treating the sustainability statement as a writing project that can be completed after the annual data close.

The ten-stage preparation process

Figure 1. A 12-18 month ESRS delivery programme with evidence and approval gates.

In practice

Stage Core actions Controlled output — Main approval or control
1. Scope and version gate Confirm CSRD/national scope, reporting period, reporting entity, consolidation basis, value-chain coverage, ESRS version and assurance context. Scope memorandum and standards-version register. — Legal, finance and reporting owner sign-off.
2. Project governance Set sponsor, programme lead, workstreams, decision rights, escalation, reporting calendar and RACI. Approved project charter and governance calendar. — Executive sponsor and audit committee or equivalent.
3. Business model and value chain Map activities, significant sectors, products/services, geographies, key resources, business relationships and affected stakeholders. Business-model and value-chain evidence map. — Strategy, risk, procurement and operations challenge.
4. Double materiality assessment Identify and assess impact and financial IROs; set qualitative considerations or thresholds; validate and approve conclusions. Methodology, IRO register, evidence register and approved material topics. — Cross-functional challenge and governance approval.
5. Disclosure architecture Translate material IROs into ESRS 2, topical DRs/ARs, general disclosures, entity-specific information and supplementary information. Disclosure matrix, content architecture and gap list. — Technical reviewer checks completeness and information materiality.
6. Data and evidence design Define each metric, period, boundary, unit, method, source, estimate, owner, reviewer, retention and linkage to financial information. Data dictionary, calculation files and evidence index. — Data-owner certification, reconciliation and change control.
7. Dry run and remediation Perform a prior-period or interim collection, test value-chain estimates, identify unavailable data and resolve methodology choices. Dry-run dataset, issue log and remediation plan. — Programme steering committee closes critical gaps.
8. Drafting and internal control Draft connected information across governance, strategy, management, metrics and targets; control cross-references and consistency with other public statements. Controlled draft, claim ledger, review comments and disclosure locator. — Prepare/review separation, legal review and internal controls.
9. Assurance readiness Agree subject matter and criteria, prepare evidence requests, test management judgements, remediate findings and lock the final data set. Assurance pack, findings log, representations and final evidence archive. — Assurance provider and responsible governance body.
10. Approval and publication Approve material conclusions, statement architecture, reliefs, claims, digital output and management-report release; archive the released version. Approved sustainability statement, publication record and lessons-learned log. — Administrative, management or supervisory body and statutory sign-off route.

In practice

A practical 12-18 month timetable

Timing Programme focus What should be visibly complete
Months 0-2 Scope, version gate, mobilisation and governance. Scope memorandum, sponsor, RACI, source register, reporting calendar and assurance strategy.
Months 2-5 Business-model, value-chain and stakeholder evidence mapping. Activity/geography map, relationship inventory, risk and due-diligence evidence, stakeholder map.
Months 4-8 DMA, thresholds, focused deep dives and approval. Approved IRO register, evidence register, material topic conclusions and IRO-1 process record.
Months 6-10 Disclosure matrix, data dictionary and dry run. DR/datapoint decisions, owners, methods, first calculations, gap log and entity-specific needs.
Months 9-13 Narrative drafting, controls and financial connectivity. First complete statement, reconciliations, review trail, claim ledger and financial-effects links.
Months 12-16 Year-end collection, consolidation and assurance fieldwork. Final dataset, evidence files, management judgements, assurance findings and remediation.
Months 15-18 Governance approval, publication and next-cycle reset. Approved final statement, release controls, archived submission, restatement triggers and lessons learnt.

A workable RACI

R = Responsible; A = Accountable; C = Consulted; I = Informed. The precise allocation depends on national governance and statutory-reporting arrangements. The control principle is more important than the labels: preparers of key information should not be the only reviewers of that information.

In practice

Activity Board / committee Executive sponsor / CFO — Reporting lead — Functional and data owners — Risk, le
Scope and reporting basis I A — R — C — C — I
DMA methodology and material conclusions A C — R — C — C — I
Disclosure matrix and entity-specific information I A — R — C — C — C
Metric definitions and calculations I A — C — R — C — C
Internal controls and evidence I A — R — R — C / R — C
Final claims, reliefs and statement approval A R — C — C — C — I
Assurance conclusion and publication I A — R — C — C — R

How the sustainability statement should be structured

Revised ESRS 1 requires all ESRS disclosures to be presented in a dedicated section of the management report identified as the sustainability statement. The statement should be clearly identifiable and both human- and machine-readable. The default structure is general information, environmental information, social information and governance information, although an alternative order may be used with a reasoned explanation. EU Taxonomy disclosures are included in the environmental section and may be placed in a separate appendix.

The structure should follow the reporting logic rather than reproduce the internal project plan. Material IROs should connect to strategy, policies, actions, metrics, targets and financial effects without forcing readers to reconstruct the links across unrelated sections. Cross-references and incorporation by reference can reduce duplication, but they must remain precise, accessible and controlled.

In practice

Requirement and implementation practice

Source-grounded ESRS requirement LRA implementation practice
The undertaking determines reported information through double materiality and information materiality and applies ESRS 2 plus relevant topical and entity-specific information. Maintain one controlled IRO-to-disclosure matrix that links each material conclusion to DRs, datapoints, owners, evidence and publication locations.
The statement is a dedicated management-report section and must state the ESRS applicable at the end of the reporting period. Freeze the version of the applicable standards, data dictionary and calculation methods before year-end collection, with controlled late changes.
The undertaking discloses the reporting basis, value-chain coverage, reliefs, significant judgements and limitations prescribed by ESRS. Run an interim dry close and a mock assurance evidence request rather than waiting for the statutory reporting timetable.

Hypothetical worked example

Why the example works: the company does not treat every data gap as a materiality conclusion, does not wait for the final annual close to define methods, and preserves separate evidence for scope, materiality, data and publication claims. The numbers are illustrative and do not establish a benchmark for project duration or number of IROs.

Hypothetical scenario

ILLUSTRATIVE SCENARIO

<p>Northstar Components is a diversified manufacturer with three reporting segments, production sites in six countries and a large outsourced logistics network. The group has finance-grade Scope 1 and 2 data but inconsistent workforce and value-chain evidence. It starts 15 months before publication. The project first confirms the consolidated reporting undertaking and identifies two value-chain areas needing estimates. It then approves a hybrid DMA, creates 74 IRO records, identifies seven material topics and builds a disclosure matrix. A dry run reveals that safety contractor data and water-stress disaggregation are not consistently controlled. These gaps are remediated before year-end. The audit committee approves the material conclusions and the final statement only after the data owners certify their boundaries and the assurance findings are closed.</p>

Illustrative only. It shows how the decision is made, not wording that can be copied or relied on.

In practice

Weak versus stronger implementation

Area Weak approach Stronger controlled approach
Scope Assume the financial consolidation perimeter answers every sustainability boundary question. Document reporting entity, own-operations boundary, value-chain coverage, metric-specific differences and group disaggregation needs.
DMA Run one management workshop and convert votes into material topics. Use business-model evidence, impact and financial criteria, stakeholder/due-diligence inputs, challenge and approval records.
Data Request every listed datapoint from every entity. Filter by material IROs and information materiality, then define owner, method, boundary and evidence before collection.
Narrative Draft generic policy descriptions and add metrics later. Draft from the IRO-to-disclosure matrix and connect strategy, actions, metrics, targets, financial effects and limitations.
Assurance Send the final report and spreadsheets to the assurer. Agree scope early, build evidence throughout, run dry requests and manage findings before publication.

Common mistakes

Starting with the ESRS datapoint list instead of scope, business model and material IROs. This creates unnecessary collection and obscures the reporting rationale.

Treating the DMA, data workstream and drafting workstream as separate projects. The disclosure matrix must connect them.

Allowing each subsidiary to define metrics independently. Group reporting needs controlled definitions, boundary rules and consolidation instructions.

Inviting the board only at final approval. Governance bodies need earlier decisions on methodology, severe impacts, material topics, reliefs and significant claims.

Confusing the assurance provider with management. Management remains responsible for the statement, evidence and judgements.

Publishing before checking consistency with the financial statements, website, investor materials, policies, targets and prior public commitments.

Myth

'Once the DMA is complete, the sustainability statement is mostly a drafting exercise.'

Reality

The DMA determines the reporting scope, but the statement still depends on information materiality, controlled definitions, evidence, estimates, financial connectivity, fair presentation, governance review and publication controls. Materiality is the beginning of the disclosure architecture, not the end of the reporting programme.

Readiness

Pre-publication readiness checklist

  • The applicable ESRS version, reporting period, reporting entity and national requirements are documented.
  • The DMA methodology, IRO register, evidence register and approval record are current and traceable.
  • Every material IRO has a defined disclosure route, or a documented reason why no separate information is material.
  • Metric definitions, boundaries, methods, estimates, source data, reviewers and comparative treatment are controlled.
  • Narrative statements and effectiveness claims are supported by evidence and are consistent with public commitments.
  • Reliefs, omissions, incorporation by reference and supplementary information are identified and clearly presented.
  • Assurance scope and wording cannot be mistaken for assurance of information outside the engagement.
  • The final statement, digital output, management report and website version are identical or reconciled.
  • The responsible governance body has approved the material conclusions and publication claim.
  • A complete archive, change log and next-cycle improvement plan have been retained.

Self-check

  1. Can the team trace a published claim back through the disclosure matrix to the material IRO, source evidence, owner and approval?
  2. Which decisions must be taken before year-end rather than during final drafting?
  3. Where does the programme separate preparation, review and governance approval?

Take it with you

The checklists as a working spreadsheet

Every checklist and table on this page, with empty status, owner and evidence columns for your team to fill in and keep.

Download .xlsx

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