Comment letter on the European Sustainability Reporting Standards (ESRS) for certain non-EU Undertakings (ESRS-40a) Exposure Draft

The Government of Japan issued a comment letter dated October 28, 2026, regarding the European Sustainability Reporting Standards (ESRS) for certain non-EU Undertakings (ESRS-40a) Exposure Draft, which was published on July 23, 2026, by EFRAG.

In this comment letter, we make the following proposals regarding ESRS-40a:

• In order to facilitate the incorporation by reference of group sustainability reports using jurisdictionally mandated standards that are functionally aligned with ISSB Standards, clarification should be made on the disclosure requirements in ESRS-40a that are not covered by the ISSB Standards (“top-ups”).
• In addition to the mixed approach proposed in the Exposure Draft, we encourage EFRAG to incorporate an alternative approach that would reduce the reporting burden on non-EU companies while requiring them to include all EU-related impacts in their ESRS-40a reporting.

The Government of Japan appreciates that the EFRAG’s Exposure Draft includes the incorporation by reference of group sustainability reports using jurisdictionally mandated standards that are functionally aligned with ISSB Standards, and the mixed approach. The proposals in this letter are intended to contribute to enhancing the operationality of the standards and reducing the reporting burden on non-EU companies.

Please see below for the details.

• Comment on the European Sustainability Reporting Standards (ESRS) for certain non-EU Undertakings (ESRS-40a) Exposure Draft

Related link: EFRAG's website

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