Commission Delegated Regulation (EU) 2023/2772 was published in the Official Journal on 22 December 2023. It contains the first set of EU sustainability reporting standards (ESRS) under the Corporate Sustainability Reporting Directive (CSRD). It applies from 1 January 2024 for financial years beginning on or after 1 January 2024 to undertakings that were already subject to the non-financial reporting requirements introduced by the Non-Financial Reporting Directive. Its application will be phased-in for other categories of undertakings. Annex I contains:

  • Cross-cutting ESRS covering general requirements such as explaining double materiality, the value chain, and how to prepare and present sustainability information.
  • Cross-cutting ESRS covering general disclosures such as governance, strategy, and impact, risk and opportunity management, and on metrics and targets.
  • Specific ESRS on environmental disclosures.
  • Specific ESRS on social disclosures.
  • Specific ESRS on governance.

Separately, a reminder that the CSRD also requires the Commission to adopt a second set of ESRS by June 2024, which will cover sector-specific standards, proportionate standards for listed SMEs and standards for non-EU companies. The Commission plans to postpone deadlines for the adoption of the sector-specific ESRS for two years (partly linked to its initiatives to reduce the reporting burden on EU corporates by 25%, and to allow in-scope companies to focus on the implementation of the above sector-agnostic ESRS). The Commission's consultation on this proposal closed on 19 December 2023, and an update is awaited.


Trilogue negotiations on the European Commission's June 2023 proposal for a regulation on the transparency and operations of ESG ratings providers are expected to start in early 2024 following confirmation of the EU Council's negotiating mandate on 20 December 2023. The European Parliament's negotiating mandate was confirmed on 4 December 2023.


The Amending EU Taxonomy Climate Delegated Act and the new EU Taxonomy Environmental Delegated Act came into force on 1 January 2024.

The Amending EU Taxonomy Climate Delegated Act adds technical screening criteria (TSC) for additional economic activities which can make a substantial contribution to climate change mitigation and climate change adaptation. For climate change mitigation, these include some manufacturing activities for components for low-carbon transport and electrical equipment and some transitional activities in waterborne transport and aviation where zero-carbon solutions aren't yet sufficiently advanced. For climate change adaptation, these include activities enabling adaptation to the unavoidable effects of climate change (e.g. desalination and services for preventing and responding to climate-related disasters / emergencies).

The New EU Taxonomy Environmental Delegated Act sets out TSC for the four remaining environmental objectives under the EU Taxonomy Regulation: sustainable use and protection of water and marine resources, transition to a circular economy, pollution prevention and control, and protection and restoration of biodiversity and ecosystems (with the latter reflecting the growing importance being attached to the impact of climate change on biodiversity). This Delegated Act also sets out criteria for determining whether these economic activities cause significant harm to any of the other environmental objectives, and amends the Taxonomy Disclosures Delegated Act to ensure consistency of disclosure requirements, and to correct some technical errors. The Commission separately noted that further work will be needed on bringing other sectors and activities (e.g. agriculture, forestry and fishing) into scope.

Remember that from 1 January 2024 financial undertakings need to start disclosing key performance indicators (KPIs) on taxonomy-alignment under the EU Taxonomy Disclosures Delegated Act. For credit institutions, the main KPI is the Green Asset Ratio - the proportion of a credit institution's assets invested in taxonomy-aligned economic activities as a share of total covered assets.

Read our article on EU Taxonomy: New Environmental Delegated Act; Changes to Climate Delegated Act


The Loan Market Association has signposted that we can expect to see a new guide on application of the sustainability-linked loan (SLL) principles to fund financing in Q1 2024, together with mandate letters for sustainability coordinators in the SLL market.

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.