EU publishes simplified and voluntary sustainability reporting standards

Two European Commission delegated regulations published in the Official Journal on 21 September 2026LAR reshape sustainability reporting: Regulation (EU) 2026/1563 simplifies the European sustainability reporting standards (ETAS/ESRS) by amending Regulation (EU) 2023/2772Europa, and Regulation (EU) 2026/1560 establishes a voluntary sustainability reporting standardEuropa that also caps the sustainability data large reporters may demand from smaller undertakings in their value chainsEuropa. The Lithuanian Finance Ministry circulated the details in a letter relayed through the Lithuanian Chamber of Auditors on 21 OctoberLAR; the letter asks the recipient organisations to pass the Finance Ministry's summary to their members and united undertakings, and the Chamber invites audit firms and auditors to study the changes.

The simplified standards keep the ESRS framework but cut its volume: according to the ministry, mandatory datapoints fall by more than 60% and total datapoints by more than 70%LARLAR, the structure is simplified, quantitative information takes priority over narrative text, materiality application is clarified, and mandatory and voluntary disclosures are separated more clearly. Regulation (EU) 2026/1563 enters into force on 10 November 2026Europa and applies to financial years beginning on or after 1 January 2027. For financial years starting in 2026, undertakings already reporting may choose between the current standards under Regulation (EU) 2023/2772 (as amended by Regulation (EU) 2025/1416) and the simplified standardsEuropa, and must state clearly in their sustainability statement which version they appliedEuropa.

Undertakings not subject to mandatory reporting under Articles 19a and 29a of Directive 2013/34/EU may report sustainability information on a voluntary basis under the standard in Regulation (EU) 2026/1560Europa, including undertakings in the value chains of reporting entities that are asked for sustainability data by their business partnersLAR. The regulation entered into force on 24 September 2026, the third day after publicationLAR, replacing the voluntary standard in Commission Recommendation (EU) 2025/1710, which no longer produces legal effectsLAR. Its operative core is the value chain cap: undertakings reporting under Articles 19a and 29a of Directive 2013/34/EU may not require value-chain undertakings averaging 1,000 or fewer employees to supply more sustainability information than the essential datapoints listed in Annex IIEuropa, and those smaller undertakings are entitled to refuse broader requestsLAR. The cap applies to financial years beginning on or after 1 January 2027Europa. Financial institutions, market participants, insurers and credit institutions requesting data outside sustainability reporting are encouraged to hold their requests to the voluntary standard as well.

In Lithuania, the mandatory scope follows the planned amendments to the Lietuvos Respublikos įmonių ir įmonių grupių atskaitomybės įstatymas described by the ministryLAR. For financial years starting 1 January 2026, the duty to report sustainability information in the management report would cover undertakings averaging more than 1,000 employees with net turnover above EUR 450 millionLARLAR whose securities are traded on regulated markets, where they are banks, central credit unions or insurance or reinsurance undertakingsLAR, together with parent undertakings of groups meeting those criteria on a consolidated basisLAR. For financial years starting 1 January 2027 and later, the duty would extend to all undertakings meeting the employee and turnover thresholdsLAR and to parent undertakings of groups meeting them on a consolidated basisLAR.

Audit firms should agree with each 2026 reporter which standards version the sustainability statement will declare, and tell value-chain clients with up to 1,000 employees they may refuse requests exceeding the voluntary standardLAR. Legal basis: Commission Delegated Regulation (EU) 2026/1563 amending Regulation (EU) 2023/2772Europa and Commission Delegated Regulation (EU) 2026/1560 supplementing Directive 2013/34/EUEuropa, and the draft amendments to the Lietuvos Respublikos įmonių ir įmonių grupių atskaitomybės įstatymas outlined in the Finance Ministry letter.