69% of companies under CSRD already have a climate transformation plan, but...

EFRAG has published its second “State of Play” report — an analysis of how companies actually report according to the European ESRS standards. It is based on 905 verified reports for the year 2025 (last year there were 656).

Good news — progress can be seen:

- a climate transformation plan was reported by 69% of companies, up from 55% year‑on‑year

- the average number of material ESRS topics slightly increased (6.3 → 6.6 on a comparable basis)

- reporting of non‑climate environmental topics is also rising: pollution (E2) 40 → 45%, water (E3) 33 → 38%, biodiversity (E4) 40 → 44%, circular economy (E5) 65 → 69%

- most frequent material topics: E1 Climate and S1 Own employees (both 99%), G1 Business conduct (95%)

But when we look beneath the surface, a gap opens between “having a plan” and “having substance”:

- only 57% of companies state decarbonisation targets compatible with the 1.5 °C pathway — a portion of those that declare a transformation plan therefore do not have it explicitly in their targets

- companies on average have targets for only half of their material topics (3.3 targets for 6.4 material topics)

- 37% of companies still do not link sustainability performance to executive compensation

Interesting differences across the EU:

The furthest ahead in transformation plans are Spain (89%), France (85%) and Denmark (81%); sector‑wise, real estate leads (95%), followed by administrative services (82%) and banks (78%).

Formal reporting, according to EFRAG, is therefore maturing quickly, but linking targets to materiality and aligning them with 1.5 °C is lagging. Reporting is becoming a standard — now the challenge is to have corresponding ambition and governance behind the numbers, not just a fulfilled disclosure obligation.