On 1 July 2026, the European Financial Reporting Advisory Group („EFRAG“) published its second annual State of Play Report 2026, providing a comprehensive overview of how European companies are implementing the ESRS framework in practice (“Report”). The Report is based on 905 assured sustainability statements for FY2025 and examines reporting trends across environmental, social and governance topics. Overall, the findings demonstrate the continued maturation of sustainability reporting across Europe and provide valuable insights for organisations preparing for the next stages of ESRS implementation. The Report is available at this link. Interactive statistics and benchmarking insights can be accessed through this link.

The Report shows that sustainability reporting practices have continued to mature during the second year of ESRS application. The most frequently identified material topics remain E1 Climate Change (99% of companies), S1 Own Workforce (99%), and G1 Business Conduct (95%).

One of the key findings concerns the evolution of Double Materiality Assessments (“DMAs”). According to the Report, 82% of companies updated their DMA processes compared to the previous reporting cycle, while most organisations now apply a hybrid methodology combining top-down and bottom-up approaches.

The Report also highlights the growing integration of sustainability into corporate strategy. The share of companies disclosing a Climate Transition Plan increased from 55% to 69%, while 63% link sustainability performance to executive incentive schemes. At the same time, reporting efficiency appears to be improving, with the average sustainability statement decreasing from 115 to 95 pages.