ESMA Proposes Narrower Metrics for EU Taxonomy Disclosure Rules

The European Securities and Markets Authority (ESMA) submitted recommendations to revise EU Taxonomy disclosures to the European Commission Thursday, Oct. 29, aiming to simplify reporting on costs and group-level metrics.

The advice covers selected key performance indicators under the EU Taxonomy disclosure framework. It would restrict the required operating expenditure (OpEx) measure to research and development spending that companies have not capitalized.

For group-level reports, ESMA recommends dropping a weighted-average indicator. The proposals also address voluntary use of counterparties’ OpEx information. Other European Supervisory Authorities coordinated with ESMA on that issue and on group reporting.

The recommendations aim to make disclosures clearer, more proportionate and easier to use, while retaining their value for decisions, comparability and reliability. The European Commission will weigh the advice during a review of the Taxonomy’s delegated disclosure rules.