Question-ID: 531

The following situations might arise.

(a) The undertaking has no target.

ESRS E1 paragraph AR 25 (b) does not set a recommendation but a methodological (application) requirement to set a new target for the base year ‘… that does not precede the first reporting year of the new target period by longer than three years.’. In other words, the base year must be one of the last three years in which the undertaking has reliably measured its GHG emissions while undertaking decarbonization actions.

GHG emission reduction targets shall at least include target values for the year 2030 (ESRS E1 paragraph 34 (d)). For example, for 2030 as the target year and a target period between 2025 and 2030, the base year shall be selected from the period between 2022 and 2025. In accordance with ESRS E1 paragraph AR 25, to set a target with a baseline figure in 2021, the target would have to cover the period of 2024 to 2030, with 2024 being the first year for reporting on the new target.

For undertakings with a reduction plan in progress at the time the CSRD comes into force, there is no need to modify the targets if they meet the requirement of ESRS E1. The plans will be revised and aligned with 2023 (reporting year) once the reduction period is over.

(b) The undertaking already has a target.

If an undertaking already has GHG emission reduction targets in place which have been publicly disclosed, these should not be updated for the purposes of CSRD requirements. The target level and base year can remain unchanged until the target is required to be updated, e.g. due to significant changes in scope or after 2030. Information on these targets should be reported in line with CSRD requirements. For its GHG emission reduction target, the undertaking shall disclose in absolute value the GHG emission reduction target and its current target base year and target baseline value. If an undertaking’s pre-existing targets are intensity targets, the CSRD requirements do not require a new absolute target to be set. Rather, they require for each intensity target an associated absolute target value to be disclosed. This associated absolute value would be based on the intensity target reduction specified for the pre-existing target.

(c) Case of early achievement.

If an undertaking achieves its target (past target period) earlier than expected, the base year may be older provided that this old base year meets the ESRS E1-4 requirements. This question will also be covered in the Implementation Guidance Transition plan being developed by EFRAG.