ESRS Standard
ESRS Standard
The term"Policy" is synonymous with the term"Policy", which is used within the German version of the ESRS standard.
ESRS 2 - General disclosures
ESRS 2 - General disclosures
7. the disclosures required in this section should be read in conjunction with the disclosures required in chapter 4 Management of Impacts, Risks and Opportunities of ESRS 2 and reported together with them
8. the entity shall explain the process for identifying material impacts, risks and opportunities and provide information on
a) Whether and how the company has reviewed its assets and operations to identify its actual and potential Impacts, Risks and Opportunities related to Water and Marine resources in the context of its own operations and within its upstream and downstream Value chain , and if so, the methods, assumptions and tools used in the review,
(b) whether and how the company has consulted, in particular with affected communities. (71)
Application Requirements (AR)
Application Requirements (AR)
AR 1 When analyzing the materiality of environmental sub-themes, the company assesses the materiality of water and Marine resources in its own operations and in its upstream and downstream Value chain and may consider the following four phases, also referred to as the LEAP approach:
(a) Phase 1: Identify where in its own operations and within its Value chain the interface with nature is located,
b) Phase 2: Assessment of Dependencies and Impacts,
c) Phase 3: Assessment of Material risks and Opportunities, and
d) Phase 4: Preparation and communication of the results of the materiality analysis.
AR 2 For the ESRS E3, the materiality analysiscorresponds to the first three phases of this LEAP approach; the fourth phase deals with the results of the process.
AR 3 The procedures for analyzing the materiality of Impacts, Risks and Opportunities shall take into account the provisions of ESRS 2 IRO-1 Description of procedures for identifying and evaluating material Impacts, Risks and Opportunities and IRO-2 Disclosures covered in the company's Sustainability statement included in ESRS.
AR 4 Subtopics related to water and Marine resources that are subject to materiality analysisinclude:
(a) Water, including surface water and Groundwater consumption, withdrawals and discharges; and
b) Marine resources, including the extraction and use of these resources and related economic activities.
Phase 1
AR 5. Phase 1 shall identify Areas at water risk and areas where there is an interface with Marine resources that could lead to Impact materialities and Dependencies, in the company's own operations and within the company's upstream and downstream Value chain. In doing so, the company may consider the following:
(a) the locations where direct assets are located and where operations and related upstream and downstream activities along the Value chain take place,
b) the sites in Areas at water risk, including Areas of high-water stress; and
c) the sectors or business units that interface with water or Marine resources in these priority locations.
AR 6. the company shall consider River basins as the relevant level for the assessment of Sites and combine this approach with an assessment of the operational risk of its Installations and Suppliers ' facilities with Impact materiality and Risks.
AR 7 The company shall take into account the criteria for determining the status of water bodies as set out in the relevant annexes of Directive 2000/60/EC (Water Framework Directive) and the guidance documents for the implementation of the Water Framework Directive. The list of guidance documents is available on the European Commission's environmental website.
Phase 2
AR 8. To assess its Impacts and Dependencies for each Priority Site identified in AR 5, the company may, in Phase 2:
(a) Identify business operations and activities that result in Impacts and Dependencies on Environmental Goods and Ecosystem Services,
b) Identify Impacts and Dependencies related to Water and Marine resources across the company's Value chain; and
c) assess the severity and likelihood of positive and negative impacts on water and Marine resources.
AR 9. the company may use international classifications such as the Common International Classification of Ecosystem Services (CICES) when identifying Dependencies related to Water and Marine resources.
AR 10. in identifying its Dependencies associated with Marine resources, the entity shall consider whether it is dependent on key Raw materials associated with Marine resources, including, but not limited to, gravel and seafood.
AR 11 Marine resources are defined according to their social use by humans and must be considered in relation to the pressures to which they are subject. Some of the pressure indicators are listed in other ESRSs, namely Microplastics and Emissions to water in ESRS E2 and Plastic waste in ESRS E5.
AR 12. examples of Dependencies related to Marine resources that the company may consider are:
(a) Dependencies on commercially harvested fish and shellfish in its own operations and within its upstream and downstream Value chain; and
b) Fishing activities with mobile bottom trawls, which can also have negative impacts on the seabed.
Phase 3
AR 13 In Phase 3, the company may, in order to assess its Material risks and opportunities based on the results of Phases 1 and 2
a) Identify Transition risks and Opportunities within its own activities and within its Value chain in the following categories:
i. Policy and law: e.g. introduction of regulations or policies (e.g. changes such as improved water protection, improved quality of water regulations, regulation of water supply), ineffective management of waters or Marine resources, especially transboundary (e.g. transboundary management), and cooperation leading to degradation of water or oceans, burden of sanctions and litigation (e.g. non-compliance with permits or allocations; neglect or killing of marine species), increased reporting requirements on marine ecosystems and related services,
ii. Technology: e.g. introduction of products or services with lower impacts on water and Marine resources, transition to more efficient and cleaner technologies (i.e. with lower impacts on water and oceans), new monitoring technologies (e.g. satellites), water purification, flood protection,
iii. Market: e.g. shift in supply, demand and financing, volatility or increased cost of water or Marine resources,
iv. Reputation: e.g. changes in the perception of society, customers or communities as a result of an organization's impacts on water and Marine resources, and
v. a contribution to systemic risks in the context of its own operations and its upstream and downstream Value chain, including the risk of a marine ecosystem collapsing or a critical natural system ceasing to function (e.g. reaching tipping points, summation of Physical risks),
b) Identify Physical risks, including Water quantity(Water scarcity, Water stress), Water quality, deterioration of infrastructure or unavailability of some Marine resources related Raw materials (e.g. rare fish species or other living marine organisms sold as products by the company), resulting for example in the inability to operate in certain geographical areas,
c) identify opportunities that fall into the following categories:
i. Resource efficiency: e.g. transition to more efficient services and processes that require less water and Marine resources,
ii. Markets: e.g. development of less resource-intensive products and services, diversification of business activities,
iii. Financing: e.g. access to green funds, bonds or loans,
iv. Resilience: e.g. diversification of Marine or Water resources and business activities (e.g. creation of a new business for Ecosystem restoration), investment in green infrastructure, Nature-based solutions, introduction of Recycling and circular mechanisms to reduce dependency on Water or Marine resources, and
v. Reputation: positively engaging stakeholders through a proactive approach to managing nature-based Risks (e.g. the ability to achieve preferred partner status).
AR 14. the company may rely on the collection of primary, secondary or model data or other relevant approaches, including Commission Recommendation 2021/2279 on the use of environmental footprinting methodologies to measure and disclose the environmental performance of products and organizations along their life cycle (Annex I - Environmental footprint of products; Annex III - Environmental footprint of organizations), to assess Impact materiality, Dependencies, Risks and Opportunities.
AR 15 When providing information on the results of the materiality analysis, the company shall consider the following:
(a) a list of geographic areas where water is material to the company's operations and upstream and downstream Value chain,
(b) a list of Raw materials related to Marine resources used by the company that are essential for the good environmental status of marine waters and for the protection of Marine resources; and
c) a list of the sectors or segments associated with Material Impacts, Risks and Opportunities from Water and Marine Resources.
Examples from past practice
Examples from past practice
Examples serve only as an indication of how a disclosure requirement has been reported by other companies to date. Audited ESRS reports are not yet available. There is no guarantee of accuracy and completeness.
E3.IRO-1 - Water and Marine resources
Water management in production
The availability of high-quality water is an essential component in the production of our products and is given special attention by our company. In dialog with various interest groups, it became clear that the issue of water is of great importance.
The main source of water for production is Surface water, which comes from rivers. In order to optimize water consumption, we continuously monitor water consumption, wastewater production and quality as well as the amount of Water (recycled and reused). Risks are identified on the basis of this data and appropriate actions are taken.
We regularly monitor and evaluate the current water supply situation in all regions in which we produce. We specifically look for actions to reduce Water consumption and examine alternative water sources.
At one plant, the risk of a potential water shortage due to river water was classified as the greatest among the production sites. A hydrogeological study was therefore conducted and long-term well tests were carried out. Based on these results, the water authority approved an increase in the extraction of Groundwater to 240,000 m³ per year if river water cannot be extracted. This volume can be safely extracted without endangering the groundwater reserves in the region.
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