ESG, with the noise turned down

ESG reporting has a reputation for being long, dull and a little bit invented. It does not have to be any of those. Turn the jargon down and there is a sensible idea underneath.

The plain version is this. A sustainability report is meant to tell the people who depend on a business the things that matter but do not appear in the financial accounts. How much it emits and wastes, how safely it runs, how it treats the people and places it touches. Investors, lenders, neighbours and staff all have a fair interest in knowing, and for a long time there was no agreed way to tell them.

2025 was the year of the great trim

For a while the direction looked settled. The European Union’s Corporate Sustainability Reporting Directive was set to bring tens of thousands of companies into mandatory, audited sustainability reporting. Then came a round of simplification. The EU’s Omnibus package, agreed at the end of 2025 and adopted in February 2026, narrowed the scope sharply, to companies with more than 1,000 employees and over 450 million euros of turnover, and cut back the detail of the standards themselves.

The UK took a different road, building on the global baseline from the International Sustainability Standards Board. In February 2026 the government published the UK Sustainability Reporting Standards, S1 and S2, aligned to the international IFRS standards, for voluntary use to begin with. Mandatory climate disclosure has been proposed for around 515 listed companies from January 2027.

“Out of scope” is not “off the hook”

It is tempting to read a narrower scope as a reprieve. For most operating businesses it is not. The large companies still in scope have to account for their supply chains, so they ask their suppliers for the data regardless of whether the supplier is directly regulated. Lenders and tender processes increasingly want it too. The request cascades downhill, and a retailer with a long line of suppliers feels this quickly.

The noise in ESG is the jargon and the box-ticking. The signal is a small number of true facts, measured as they happen.

Honest measurement beats year-end archaeology

The companies that find reporting painful are usually the ones assembling it from memory and spreadsheets in a panic at year-end. The ones that find it routine capture the facts as events: a spill logged when it happens, an energy figure read from a meter rather than reconstructed months later. Report what genuinely matters to the business and the people around it, and say it plainly. A report nobody can read is not transparency, whatever the framework says.

The rules will keep moving, as they just have. The habit that survives every version is the same: measure honestly, at the source, while it is still true. Get that right and the report becomes something you run, not something you dread.

References

1. Council of the EU, “Council and Parliament strike a deal to simplify sustainability reporting”, 9 December 2025. consilium.europa.eu.
2. UK Government, “UK Sustainability Reporting Standards”. gov.uk/guidance/uk-sustainability-reporting-standards.

Shannon Hamming writes about how the working world keeps itself safe and honest: incident reporting, quality, ESG, compliance and the sensible use of technology in safety-critical work. Useful first, interesting always.