Connectivity Project: Description
The EFRAG connectivity research project was initiated in 2022. It aims to provide stakeholders with thought leadership on the concepts and practical application of connectivity, and its main deliverable is a Discussion Paper to be published in December 2025. A 22-person multi-stakeholder connectivity advisory panel (EFRAG CAP) was formed in 2023. The EFRAG SR and FR boards and TEGs, along with the EFRAG CAP, guided the project. Key project milestones include: multiple EFRAG-hosted events, an interim deliverable published in 2024, and the mentioned Discussion Paper.
Connectivity Project: 2025 Discussion Paper
In December 2025, EFRAG released its Discussion Paper (DP) "Connectivity of Financial and Sustainability Reporting", following its 2021 research agenda consultation, where connectivity was the top-ranked topic by EU stakeholders. The DP highlights concepts, types, and mechanisms of the connectivity of reported information. It also highlights that connectivity can enhance reporting quality irrespective of the underlying reporting framework.
The DP emphasises that the importance of connectivity extends beyond linking sustainability statements to the financial statements or addressing only sustainability-related matters. It shows that connectivity is improving even though companies are still in the early stages of applying this concept. It identifies current gaps, such as inconsistent terminology, and possible underreporting of sustainability-related information in the segment disclosures in the financial statements. The DP also suggests the way forward, including clarifying the boundary of financial statements with respect to disclosures, and developing application guidance for the assessment of qualitatively material information in the financial statements. It underscores that improving connectivity will be a multi-stakeholder effort involving preparers, standard setters, auditors, and enforcers.
The DP has a supplemental document containing 17 real-world illustrations from company reports. These illustrations demonstrate practical instances of connectivity between sustainability disclosures under ESRS or ISSB Standards and financial statements under IFRS Accounting Standards, and they help stakeholders visualise how connectivity is applied in practice.