EFRAG Launches Public Consultation on the ESRS-40a Exposure Draft for Certain Non-EU Undertakings

EFRAG launches a 100-day public consultation on the Exposure Draft of the European Sustainability Reporting Standards for certain non-EU undertakings (ESRS-40a ED), developed as technical advice to the European Commission under Article 40a of the Accounting Directive.

EFRAG today publishes the ESRS-40a Exposure Draft and opens the related public consultation, inviting all interested stakeholders, both within and outside the European Union, to share their views on the proposed standard before 31 October.

The draft standard applies to certain third-country undertakings with significant activities in the European Union that meet the reporting thresholds set out in Article 40a of the Accounting Directive and supports the implementation of the Corporate Sustainability Reporting Directive (CSRD). EFRAG encourages undertakings to provide feedback on the proposals in the Exposure Draft, including on the practical implementation challenges and the relevance of the resulting disclosures.

The feedback received will inform the further development and finalisation of EFRAG's Technical Advice to the European Commission.

The objective of ESRS-40a reporting is to ensure that there is a level playing field for undertakings operating in the EU market, as well as to ensure transparency on impacts on people and the environment of non-EU undertakings with relevant EU activities.

ESRS-40a standards were previously denominated in EFRAG preliminary documents as Non-EU ESRS (N-ESRS) or ESRS for third countries (ESRS-TC).

📄 ESRS-40a Exposure Draft

➡️ Submit your feedback via the online questionnaire

How to participate

Stakeholders are invited to:

  • Review the ESRS-40a Exposure Draft and the accompanying supporting documents;
  • Complete the online consultation questionnaire and provide technical comments and recommendations.

Consultation supporting documents

EFRAG has also made available the recording and presentation of the webinars introducing the exposure draft and explaining the consultation process.

Next steps

Following the close of the consultation, EFRAG will analyse stakeholder feedback and use it to finalise its Technical Advice, which is expected to be delivered to the European Commission in January 2027. The European Commission will subsequently launch its own public consultation before adopting the delegated act.

The first sustainability reports prepared under the future ESRS-40a are expected to cover financial year 2028, with publication in 2029.

In addition, EFRAG will release a Cost-Benefit Analysis in mid-August 2026 and encourages stakeholders to share their views on the expected costs and benefits of the proposed requirements set out in the Exposure Draft.

Kerstin Lopatta, EFRAG SRB Chair, stated:

"Article 40a of the Accounting Directive gives EFRAG a clear and focused mandate: to develop a standard that captures how large non-EU companies impact people and the environment. Getting this right requires input from those who will use and apply the standard, which is why this public consultation is open to all stakeholders worldwide. At stake are both a level playing field and genuine transparency in the EU Single Market. The feedback we receive over the next 100 days will directly shape the technical advice we deliver to the European Commission in January 2027 and pave the way for smooth application when reporting becomes mandatory for the 2028 financial year, with first reports due in 2029."

Chiara Del Prete, EFRAG SR TEG Chair, commented:

“This Exposure Draft is the last piece of the CSRD to come into effect. It brings transparency on the impacts of the largest international groups around the world when they have significant EU activities. It will support a level playing field for EU companies. We understand the challenges these groups face, particularly for topics other than climate, which are covered by mandatory reporting in only a few jurisdictions. For this reason, we plan an extensive dialogue with them through the field test, the public consultation, and several outreach events, including to facilitate seamless reporting for those that already report based on financial materiality.”

Access the ESRS-40a consultation page for more info on the objectives of this standard, the scope and timeline.

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