Physical climate risk data,
ready for ESRS E1.
Most of ESRS is narrative. E1-9 isn't. The European Sustainability Reporting Standards (ESRS) turn the Corporate Sustainability Reporting Directive (CSRD) from a legal obligation into specific disclosures. Eleven standards ask you to describe. One asks you to quantify: the anticipated financial effects of physical climate risk and transition risk on every material asset you own. That's where ESRS gets hard. And it starts with the data.
ESRS is the EU rulebook that turns CSRD's legal obligation into specific environmental, social and governance disclosures, with E1-9 quantifying the financial effects of climate risk.
Large EU companies and EU-listed firms meeting the size thresholds, plus certain non-EU groups with material EU operations. Wave 1 reports for FY2024 are filed; the simplified ESRS are expected to apply from FY2027.
ESRS is the rulebook. CSRD is the law.
CSRD requires disclosure. ESRS specifies what to disclose. Twelve standards run the spectrum from cross-cutting governance to topic-specific environmental, social and governance content. Most have been substantially simplified; one (E1) remains uniquely demanding.
Disclosure used to be a story. E1-9 made it a number.
EFRAG cut datapoints by 61%. It didn't cut the climate risk disclosure. The hardest part of ESRS is still the part that needs real data.
Eleven describe. One quantifies.
Most ESRS disclosures are narrative or method-based. E1-9 asks for euros, by horizon, on every material asset exposed to physical climate risk or transition risk.
Asset-level, or audit-fail.
ESRS expects granularity that survives external assurance. Asset-level exposure across material physical operations, not country averages or postcode-level proxies.
Get E1-9 right, the rest follows.
Your transition plan, your adaptation strategy, your targets, your climate resilience case to investors. They all rest on the same physical climate risk data spine.
The ESRS framework: 12 standards, grouped into 7 sections.
ESRS spans 12 individual standards. Some sit alone (ESRS 1, ESRS 2, ESRS E1, ESRS G1). The rest cluster naturally: E2-E5 are the other environmental topics, S1-S4 cover social. Click each section to unpack what the standards actually require, with notes on how the simplified Set 1 changes the original.
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Chapter 1: ESRS 1 General Requirements
The plumbing of the whole framework.
ESRS 1 sets the rules: how materiality works, how value chain is treated, what time horizons mean, how to consolidate. Simplified Set 1 substantially streamlines DMA documentation.
- Double Materiality Assessment (DMA): simplified methodology, lighter documentation
- Value chain: estimates now permitted, direct-data preference removed
- Time horizons: short (≤1y), medium (1-5y), long (>5y)
- Phase-in provisions extended for E1-9 anticipated financial effects
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Chapter 2: ESRS 2 General Disclosures
The cross-cutting backbone.
ESRS 2 applies regardless of which topical standards are material. Governance, strategy, IRO management, metrics and targets, all cross-cutting and mandatory.
- GOV: governance, oversight, management roles for sustainability
- SBM: strategy, business model and stakeholder engagement
- IRO: process for identifying impacts, risks and opportunities
- MDR: minimum disclosure requirements on policies, actions, targets, metrics
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Chapter 3: ESRS E1 Climate Change
Nine sub-disclosures. One headline standard.
E1 covers transition planning, climate change adaptation, emissions and (uniquely) the anticipated financial effects of physical climate risk and transition risk. This is where most firms struggle, and where audit scrutiny lands hardest.
- E1-1 Transition plan: 1.5°C-aligned, with capex linkages
- E1-4 Targets: science-based, time-bound, progress-tracked
- E1-6 GHG emissions: Scope 1, 2 and 3 with methodology
- E1-9 Anticipated financial effects: quantified euro impact, by horizon
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Chapter 4: ESRS E2 to E5
Beyond climate, four environmental standards.
Triggered if material per your DMA. The simplified Set 1 reduces narrative requirements substantially while keeping the topical structure.
- E2 Pollution: air, water, soil, substances of concern
- E3 Water and marine resources: withdrawals, discharges, stress
- E4 Biodiversity and ecosystems: impacts, dependencies, sites
- E5 Resource use and circular economy: inflows, outflows, waste
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Chapter 5: ESRS S1 to S4
People, inside and along the value chain.
Four social standards covering own workforce out to consumers and end-users. Simplified Set 1 introduces additional reliefs for value-chain workers (S2) and affected communities (S3).
- S1 Own workforce: employees, contractors on-site
- S2 Workers in the value chain: upstream and downstream
- S3 Affected communities: indigenous peoples, local rights-holders
- S4 Consumers and end-users: product safety, access, dignity
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Chapter 6: ESRS G1 Business Conduct
Conduct, culture, payments.
A single governance standard covering business ethics, anti-corruption, political engagement, supplier relations and payment practices. Often less material to climate-focused readers but mandatory if relevant.
- Corporate culture and business conduct policies
- Anti-corruption and anti-bribery training and incidents
- Political engagement, lobbying and contributions
- Supplier relationships and payment-practice transparency
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Chapter 7: Datapoints, MDR & filing
From standard to filed report.
ESRS disclosures land in the management report, machine-readable via ESEF tagging, audit-ready and traceable. The simplified Set 1 removes voluntary datapoints entirely.
- Mandatory datapoints reduced by 61% in EFRAG's December 2025 advice
- Voluntary disclosures eliminated; only mandatory and "if-material" remain
- European Single Electronic Format (ESEF, XBRL) tagging required for filed sustainability statements
- External assurance: limited from day one, reasonable from FY2027 onward
Climate risk just became a disclosure number.
Asset-level physical climate risk, forward-looking scenarios, audit-grade methodology. The same data spine carries E1-9 disclosure, adaptation planning and the climate resilience case to investors.
Quantified financial effects
Anticipated euro impact from material physical and transition risks, by short, medium and long-term horizon. The hardest disclosure in the standard.
Asset-level physical climate risk
Property-by-property exposure across real estate, supply chain nodes and operational facilities. Country averages won't survive limited assurance, and they won't underwrite a credible adaptation plan.
Forward-looking scenarios
1.5°C, 2°C and current-policy pathways. Historical loss data alone won't satisfy E1-9, and proxies must be transparently documented.
Audit-grade methodology
Limited assurance now, reasonable assurance from 2027. Every model, proxy and assumption must be defensible to an external auditor.
Physical climate risk data, built for ESRS E1 disclosure.
Spectra is the physical climate risk data platform behind ESRS E1 disclosures at banks, insurers, asset managers and real estate firms with over $13 trillion in combined AUM. Asset-level exposure, forward-looking scenarios, audit-ready methodology, all in one place.
Asset-level exposure, 1.5bn assets
Material physical climate risk for every asset in scope. 11 hazards, building-level vulnerability, geolocation precision. The granularity ESRS E1 expects, without postcode proxies.
Scenarios E1-9 actually requires
CMIP6 SSPs and CMIP5 RCPs including the high-emission pathway E1-9 mandates. Short, medium and long-term horizons in 5 to 10 year intervals to 2100.
Hazard exposure to financial impact
Annual losses in monetary value and percentage, business disruption risk and confidence intervals. The translation from physical hazard to anticipated financial effect E1-9 demands.
Audit-ready by design
Model risk management aligned, ISO 27001 and ISO 14001 certified, full methodology documentation. Defensible to limited assurance now, reasonable assurance from 2027.
Are you ready for ESRS E1 climate risk disclosure?
Pick your industry. The E1-9 question tailors itself to where physical and transition risk hits your sector hardest.
ESRS readiness self-check
ESRS E1 physical climate risk: the questions buyers actually ask.
What is ESRS E1?
ESRS E1 is the European Sustainability Reporting Standard for climate change. It is the climate disclosure standard inside the Corporate Sustainability Reporting Directive (CSRD), and it covers transition plans, Scope 1 to 3 greenhouse gas emissions, the resilience of the business model under climate scenarios, and the anticipated financial effects of physical and transition climate risk on assets and operations.
Who has to report under ESRS E1?
Large EU companies meeting CSRD size thresholds, EU-listed firms (including listed SMEs on a delayed timeline), and certain non-EU groups with material EU operations. Wave 1 reporters filed first ESRS-aligned disclosures for FY2024. Simplified ESRS is expected from FY2027 reporting periods following the EFRAG amendments adopted in 2026.
What is asset-level physical climate risk under ESRS E1?
Asset-level physical climate risk is the exposure of each material asset (real estate, supply chain nodes, operational facilities, financed assets) to climate hazards such as flood, heat, wildfire, drought and storm, modelled across short, medium and long-term horizons under multiple emissions scenarios. ESRS E1 disclosure requirement E1-9 then asks for the anticipated financial effect of that exposure, expressed in monetary terms.
What does ESRS E1-9 require for physical risk?
E1-9 requires disclosure of the anticipated financial effects from material physical and transition risks, including the monetary amount and percentage of assets at material physical risk before and after adaptation actions, the share of net revenue exposed, methodology used (including scenarios and time horizons), and key assumptions and limitations. It is the standard's hardest disclosure because it requires translating hazard exposure into euros at asset level.
What climate scenarios does ESRS E1 expect?
ESRS E1 expects scenario analysis using at least one high-emission scenario for physical climate risks, and at least one scenario aligned with limiting warming to 1.5°C with no or limited overshoot for transition risks. In practice this means CMIP6 SSPs (typically SSP1-2.6 and SSP5-8.5) or CMIP5 RCPs (RCP2.6 and RCP8.5), assessed across short, medium and long-term horizons consistent with the company's strategic planning windows.
How does Climate X help with ESRS E1?
Climate X provides asset-level physical climate risk data for ESRS E1 disclosures via Spectra. The platform delivers exposure across 11 hazards for 1.5 billion assets, scenario coverage spanning CMIP6 SSPs and CMIP5 RCPs to 2100, financial impact translation in monetary value, and full methodology documentation for limited and reasonable assurance. Used by financial institutions managing over $13 trillion in combined AUM. Explore Spectra or book a demo.
From hazard to euros.
Asset-level physical climate risk and adaptation data, ready for E1-9 disclosure and the climate resilience case downstream.
