CSRD: what are the key requirements on biodiversity (ESRS E4)?
As of 2025, a new EU initiative, the Corporate Sustainability Reporting Directive (CSRD) requires companies to disclose their impacts and dependencies on biodiversity, and how their activities align with global biodiversity goals.
More specifically, the regulation integrates biodiversity through the European Sustainability Reporting Standards (ESRS), with the ESRS E4 focusing specifically on Biodiversity and Ecosystems.
As a reminder, the CSRD has been transposed in domestic legislations by France, Czech Republic, Denmark, Romania, Slovakia, Ireland and Sweden so far.
ESRS framework - Source: darwin
The ESRS E4 remains very technical and complex to understand for people without specific biodiversity and/or regulatory knowledge: we have thus strive below to clarify its content. The official list of datapoints included in the standard was published by EFRAG (the advisory body of the European Commission) in May 2024 . You can find the link here.
The ESRS E4 standard includes 125 datapoints distributed in 2 general disclosures sections from ESRS 2 (SMB-3 on materiality assessment and IRO-1 on processes) and 6 disclosure sections specific to biodiversity and ecosystems. As a reference point, there are 217 DPs for E1 on Climate Change and 72 on E2 for Pollutions.
ESRS E4 datapoints (DPs) distribution - Source: Darwin
High-level statistics.
Among the 125 data points (DPs) to be disclosed within the ESRS E4, nearly half of them (60) are mandatory.
A large majority of those datapoints (110) are qualitative (i.e. narrative & semi-narrative data points as defined below).
More than half of the datapoints (67) are linked to strategy (E4-1), policies (E4-2), actions (E4-3) & targets (E4-4).
ESRS E4 datapoints (Dos) distribution - Source: darwin
Some key take-aways.
The standard acknowledges that the ESRS E4 is closely connected to other environmental matters as the main direct drivers of biodiversity loss as defined by the IPBES are climate change, pollution, ecosystems (terrestrial, freshwater and sea) use change, direct exploitation of organisms and invasive alien species. These drivers are covered in this standard, except for climate change (covered by ESRS E1), pollution (covered by ESRS E2 and ESRS E5 for pollution generated by waste), and water resources (covered by ESRS E3).
The concept of “double materiality” is applied here: the company needs to manage and report both the impacts it has on biodiversity and the extent to which it is (financially) dependent on biodiversity.
The assessment under the ESRS E4 is very comprehensive and includes:
the identification of biodiversity-sensitive sites
the company contribution to direct impact drivers on biodiversity loss (the “5 pressures” mentioned above which are at the core of darwin’s assessment methodology)
the impacts and dependencies on ecosystem services.
Biodiversity impacts should be assessed regarding 2 complementary dimensions :
the impacts on the conservation state of species (i.e., species population size, species global extinction risk)
the impacts on the extent and condition of ecosystems (e.g., land degradation, desertification and soil sealing).
The standard covers the full value chain of the company, i.e. its own operations (scope 1) as well as the upstream (supply chain) and downstream (scope 3).
Life Cycle Assessment (LCA) is recognized as an acceptable methodology to assess land use related impacts (AR46).
As evidenced by the distribution of data points, the CSRD aims to be more than just a snapshot of a company's environmental performance; it seeks to serve as a transformative framework that aligns business models with global sustainability goals.
The primary goal of the CSRD is closely tied to the planetary boundaries framework, requiring that business strategies align with maintaining planetary thresholds, particularly regarding biosphere integrity and land-system change.
Businesses must therefore report on their biodiversity strategies, including developing transition plans aimed at achieving no net loss of biodiversity by 2030 in line with the Kunming-Montreal Global Biodiversity Framework and the EU Biodiversity Strategy for 2030.
The standard builds upon and/or is compatible with other reporting frameworks. More specifically:
The LEAP framework from the TNFD is mentioned as a methodology for materiality analysis and forms an entry point to a structured risk assessment. The EFRAG and the TNFD recently published a transposition mapping (see our recent article on reporting frameworks here).
The new GRI standard on biodiversity (i.e. GRI 101 released in January 2024) was designed to be aligned with ESRS E4 regarding the adoption of the double materiality approach, the requirements for the financial risk and impact assessments. GRI does not cover dependencies.
As ESRS E4 refers directly to planetary boundaries, SBTN guidance should be used to inform the Targets sections.
Specific metrics requirements.
More specifically, companies should report indicators & metrics related to their material impacts resulting in biodiversity and ecosystem change, which includes:
Key indicators & metrics included in ESRS E4 - Source: darwin
That said, it’s important to note that while ESRS E4 outlines numerous indicators and offers a range of suggested metrics for each, companies ultimately have the discretion to choose which metrics to adopt. On one hand, this flexibility is welcome; on the other, it could pose challenges for benchmarking across companies. However, as the market evolves, more standardized and robust guidelines are expected to emerge in the coming years.
All in all, this standard is designed to bring consistency and rigor to biodiversity reporting, pushing companies to integrate these considerations into their core strategies.
At darwin, we can help you better understand its subtleties, and navigate the rapidly evolving nature regulatory landscape.
