In the world of fashion, we often talk about the hand of a fabric, i.e. the way it feels, its weight, and its structure. Today, the fashion and textile industry is engaging with a different kind of structure called the European Sustainability Reporting Standards (ESRS).
For sustainability leaders who joined this industry to bring about measurable change, and for manufacturers who are looking to align with evolving brand and regulatory expectations, ESRS is a representation of a new operating reality. But, they are fast becoming the reference framework through which various stakeholders can assess whether sustainability commitments are credible, comparable, and decision-ready.
ESRS has recently seen regulatory refinements that clarify how it should be applied in practice. The intent of the framework, however, has remained unchanged. It aims to ensure that sustainability disclosures reflect real impacts, real risks, and real progress across the value chain.
If ESRS standards feel like an overwhelming tangle of data to you, this guide will be of help. It outlines how fashion and textile companies can navigate ESRS and meet regulatory expectations.
A Maturing Framework
The ESRS were designed to capture the full spectrum of environmental and social impacts associated with business activity. As companies began implementing the standards, regulators provided additional guidance to ensure that disclosures remain both rigorous and proportionate.
The core principle is fair presentation: sustainability statements should truthfully reflect the most significant impacts, risks, and opportunities associated with a company’s business model. This does not reduce expectations; rather, it raises the bar for relevance, coherence, and internal consistency.
All data points under ESRS are subject to materiality assessment. This means disclosures must be grounded in a clear understanding of
- where impacts actually occur
- where risks to enterprise value are most pronounced.
For fashion and textiles, this sharpens focus on areas such as climate exposure, resource intensity, chemical use, and labour conditions, topics that continue to attract intense regulatory and market scrutiny.
Double Materiality
Double materiality remains the structural backbone of ESRS and a critical strategic exercise for fashion and textile companies. It requires organisations to assess sustainability topics through two interconnected lenses:
- Impact Materiality (Inside-Out): How activities across the value chain affect people and the environment, from agricultural inputs and processing stages to working conditions and waste outcomes.
- Financial Materiality (Outside-In): How environmental and social factors influence financial performance, cost structures, supply security, and long-term viability.
Applying Double Materiality in Practice
Current regulatory guidance encourages companies to anchor materiality assessments in their business model and operating context. Rather than approaching DMA as a theoretical scoring exercise, organisations are expected to start with structural realities, i.e. sourcing geographies, dominant materials, production processes, and known sector risks.
Accountability is reinforced through this approach. By explicitly linking impacts and risks to business fundamentals, ESRS strengthens the connection between sustainability reporting, enterprise risk management, and strategic planning.
Core ESRS Topics for Fashion and Textiles
While ESRS comprises 12 topical standards, several will be material for most fashion and textile organisations.
ESRS E1: Climate Change and Transition Planning
Climate change remains universally material for the sector. Beyond emissions disclosure across Scope 1, 2, and 3, companies must articulate a Transition Plan that demonstrates how their strategy, sourcing, and operations align with a climate-resilient, low-carbon future.
Manufacturer perspective: As brands face increased scrutiny on Scope 3 emissions, expectations for primary supplier data, traceability, and methodological consistency continue to rise.
ESRS E2: Pollution
Reporting on pollution, including microplastics where material, reflects growing regulatory and consumer concern around chemical use and fibre shedding in synthetic textiles.
ESRS E5: Resource Use and Circular Economy
This standard addresses fashion’s dependence on raw materials and its downstream waste footprint. Required disclosures include:
- Resource inflows: Types and volumes of materials used.
- Resource outflows: Product durability, repairability, recyclability, and waste pathways.
ESRS S2: Workers in the Value Chain
For fashion, social impact is concentrated beyond owned operations. ESRS requires disclosure of due diligence processes, risk identification, and remediation measures related to wages, working hours, health and safety, and forced labour risks across the value chain.
Value-Chain Data: Expectations, Constraints, and Accountability
ESRS recognises the complexity of global fashion supply chains while maintaining clear expectations for transparency.
Companies are expected to make reasonable, documented efforts to obtain value-chain data. Where direct data is unavailable, the use of estimates or sector-based proxies is permitted, provided assumptions are disclosed and improvement plans are in place.
To prevent disproportionate pressure on smaller suppliers, safeguards aligned with the Voluntary SME (VSME) standard limit the data that large companies can request from SME partners. This reinforces proportionality without diluting responsibility for identifying and managing value-chain impacts.
Building ESRS Readiness: A Structured Approach
Effective ESRS implementation requires early preparation and cross-functional coordination. Most organisations benefit from a 12–18 month readiness horizon.
- Value-Chain Mapping: Identify high-impact suppliers, processes, and geographies.
- Materiality Assessment: Anchor DMA in business fundamentals and sector risk profiles.
- Data Readiness Review: Assess availability, quality, and governance of existing data.
- Digital Enablement: Prepare for structured, machine-readable reporting and internal controls.
- Assurance Preparation: Establish documentation and audit trails to support third-party verification.
Reporting Timelines: Planning with Certainty
Implementation timelines follow a phased approach to ensure orderly adoption:
- Large companies previously under NFRD – reporting FY 2024 data in 2025.
- Large EU companies (>1,000 employees or €450M turnover) – first reporting FY 2027, published in 2028.
- Non-EU parent companies with significant EU activity – reporting starts FY 2028, published in 2029.
Reporting as Proof of Impact
ESRS reflects a broader shift in how sustainability performance is evaluated. Markets are no longer satisfied with ambition statements or isolated metrics. They demand evidence, consistency, and assurance.
Strong ESRS reporting does not replace impact but substantiates it. It demonstrates that sustainability commitments are embedded in governance, risk management, and operational decision-making. The framework provides companies with a disciplined way to translate complex value-chain realities into disclosures that are credible, comparable, and trusted.
For fashion and textile companies, ESRS is not a signal that expectations are easing. It is a signal that expectations are becoming more precise. Those who treat reporting as strategic infrastructure, rather than an administrative exercise, will be better positioned to meet regulatory scrutiny, maintain market access, and lead on sustainable transformation.
