Sustainability reporting and due diligence update – October 2026

There have been a number of updates on sustainability reporting and due diligence requirements, both at an EU and domestic level, since our last sustainability reporting and due diligence update. In this article, we have set out a brief overview of some of the key developments that companies should be aware of.

Irish sustainability reporting updates

Update on Ireland’s transposition of omnibus amendments to CSRD 

On 14 July 2026, in a written response to a parliamentary question, Minister of State at the Department of Enterprise, Tourism and Employment (DETE), Niamh Smyth, confirmed that work is ongoing to implement the amendments to the Corporate Sustainability Reporting Directive (CSRD) in Ireland. DETE is currently working with the Office of the Parliamentary Counsel to transpose the relevant provisions of the Omnibus I Directive and intends to introduce the necessary legislative amendments during 2026, ahead of the March 2027 transposition deadline. The stated aim is to provide companies with greater legal certainty regarding their sustainability reporting obligations under the revised CSRD framework.

European sustainability reporting updates

Council agrees negotiating position on SFDR 2.0

On 24 June 2026, the Council of the EU agreed its negotiating position on the revised Sustainable Finance Disclosure Regulation (SFDR 2.0), paving the way for negotiations with the European Parliament (EP) once the latter has adopted its own position.

Revised sustainability reporting standards published

On 3 July 2026, the European Commission adopted revised European sustainability reporting standards (ESRS) and revised sustainability reporting standard for voluntary use (the new VSME Standard). The delegated acts were published in the Official Journal of the EU on 21 September 2026.

The revised ESRS will come into force on 10 November 2026, and the new VSME Standard will come into force on 24 September 2026. They will both apply to the financial years beginning on or after 1 January 2027.

Public consultation on ESRS for certain non-EU companies

On 23 July 2026, EFRAG launched a public consultation on draft ESRS for certain non-EU undertakings (ESRS-40a). The draft standards are intended to support the CSRD reporting requirements applicable to certain non-EU companies with significant EU operations under Article 40a of the Accounting Directive. These standards were previously referred to as “non-EU ESRS (N-ESRS)” or “ESRS for third countries (ESRS-TC)”. Feedback received through the consultation will inform EFRAG’s technical advice to the European Commission, which is expected to be submitted in January 2027 ahead of the standards being finalised. The consultation is open until 31 October 2026.

EFRAG releases interactive revised ESRS and new VSME Standard 

On 28 July 2026, EFRAG published interactive versions of the revised ESRS and new VSME Standard on its knowledge hub, following their adoption by the European Commission on 3 July 2026.

EFRAG publishes 2026 draft list of datapoints for revised ESRS

On 28 August 2026, EFRAG published the new 2026 draft list of datapoints. The list reflects the revised ESRS adopted by the European Commission in June 2026 and brings together all ESRS datapoint definitions to support companies in preparing their sustainability statements.

Economic and Monetary Affairs Committee votes on SFDR 2.0

On 10 September 2026, members of the EP’s Economic and Monetary Affairs Committee voted in favour of clearer, simpler sustainable finance disclosure rules. The EP will announce its negotiating mandate on SFDR 2.0 at the start of the October I plenary session. 

Survey on cost-benefit analysis for draft ESRS-40a

On 11 September 2026, EFRAG launched an online survey to support its cost-benefit analysis of the draft ESRS 40a standard. The survey seeks feedback from non-EU companies that may be in scope of ESRS 40a reporting on the expected costs and benefits of applying the proposed requirements. Responses can be submitted until 11 October 2026.

Irish due diligence updates

DAFM revising forestry policies to reflect EUDR requirements

On 11 June 2026, in response to a parliamentary question, the Minister of State at the Department of Agriculture, Food and Marine (DAFM) confirmed that the DAFM is currently updating the Felling and Reforestation policy guidelines to align with the EU Deforestation-free Products Regulation (EUDR).

DETE prepares for FLR implementation

On 2 July 2026, in response to a parliamentary question, the Minister for Enterprise, Tourism and Employment confirmed that his department is leading preparations for the full implementation of the Forced Labour Regulation (FLR), noting that member states must notify the European Commission of the penalties they intend to adopt for the purposes of enforcing the FLR by December 2026.

Cabinet approves progression of Ireland's EUDR bill

On 7 August 2026, Minister Heydon received approval from cabinet to progress the Deforestation and Forest Degradation Bill 2026 in relation to drafting the legislation and initiating pre-legislative scrutiny. The draft bill is Ireland's proposed legislation to implement the EUDR.

European due diligence updates

Consultation on CSDDD implementation guidelines 

From 12 June to 14 August 2026, the European Commission held a public consultation on practical guidelines for implementing the CSDDD. The resulting guidelines are intended to help companies comply, support member state enforcement, and clarify expectations for stakeholders, including non‑EU suppliers linked to in scope companies. The guidelines are expected to be published in Q1 2027.

Forced Labour Single Portal launched

On 30 June 2026, the European Commission launched a Forced Labour Single Portal to support preparation for the FLR. The portal provides implementation guidance, supply chain risk resources, and a draft list of national authorities.

Commission adopts further EUDR implementation measures

On 13 July 2026, the European Commission adopted a delegated act updating the list of in scope products set out in Annex I of the EUDR. The act also introduces targeted exemptions for certain categories of products, including waste, used and second hand products, and packing materials. The delegated act was published in the Official Journal of the EU on 17 September 2026.

The Commission also adopted an implementing act setting out the technical rules governing the EUDR Information System, including measures aimed at simplifying compliance and reporting processes. The Information System reopened in June 2026, with further functionality and implementation measures expected to follow.

Updated EUDR guidance published

On 20 July 2026, the European Commission's updated guidance document for the EUDR was published in the Official Journal of the EU. The guidance clarifies key definitions, roles, implementation timelines, and the products and activities within scope. The guidance also explains due diligence requirements, including legality assessments, recognises the role of certification and third party verification schemes, and provides further clarification on the meaning of “agricultural use.”

FLR implementation guidelines published

On 3 September 2026, the European Commission's guidelines on the application of the FLR were published in the Official Journal of the EU. The guidelines are intended to support the consistent implementation of the Regulation and provide practical guidance for competent authorities, customs authorities, economic operators and other stakeholders involved in its application.

For further information on any of these updates, please contact Jill Shaw, ESG & Sustainability Lead, or any other member of the ALG ESG & Sustainability team.
 

Date published: 22 September 2026