ESRS E1 — the European Sustainability Reporting Standards' climate change topic standard — is structured around seven disclosure requirements, each corresponding to a specific aspect of a company's climate-related performance and strategy. Finance teams and sustainability managers approaching their first CSRD-required sustainability statement often find ESRS E1 more granular than the voluntary frameworks they've previously used. This checklist maps the key disclosure requirements to the data and documentation a finance team needs to assemble, with notes on where the common preparation gaps are.
One structural point before diving in: ESRS E1 applies only if climate change is determined material under the company's double materiality assessment. In practice, almost every entity subject to CSRD will find climate material — both from an impact perspective (the company's emissions affect the climate) and increasingly from a financial perspective (transition and physical risks affect the business). The materiality determination should be documented and defensible; external assurance providers will look at the methodology used to determine what is in scope.
E1-1: Transition Plan for Climate Change Mitigation
Disclosure requirement E1-1 covers the company's transition plan — the time-bound strategy for aligning business activities with a 1.5°C pathway. The ESRS does not require a company to have a transition plan; it requires disclosure of whether one exists, and if so, what it contains. Companies without a transition plan must state that fact explicitly.
What finance teams need to prepare: A documented transition plan narrative covering: the GHG reduction milestones aligned with a recognized science-based scenario; the capital expenditure and operational expenditure earmarked for transition activities by year; how the plan integrates into financial planning and risk management; and any locked-in emissions from existing assets (stranded asset analysis). If the company has committed to SBTi targets, the SBTi commitment letter and target details feed directly into this disclosure.
Common gap: Many companies have a high-level net-zero ambition statement but not a transition plan with financial resource allocation. For the first reporting year, a developing-stage plan can be disclosed as such — but the disclosure must be clear about what is committed versus aspirational.
E1-2: Policies Related to Climate Change Mitigation and Adaptation
This disclosure requirement asks for the policies a company has adopted to address climate change, including both mitigation (reducing emissions) and adaptation (managing physical climate risks). Policies should reference the scope of application (which operations, which geographies), the responsible governance body, and how they connect to the transition plan.
What finance teams need: Policy documents with version dates, governing-body approval records, and evidence of integration into relevant business processes (procurement, capex approval, supplier code of conduct). This is often an administrative consolidation exercise rather than a new analysis.
E1-4: Targets Related to Climate Change Mitigation and Adaptation
E1-4 is where quantitative GHG reduction commitments are disclosed. Required data points include: the base year; the target year; whether the target is absolute or intensity-based; the GHG scopes covered; and the methodology or framework used to set the target. If GHG targets have been approved by SBTi, that should be stated. If targets have not been externally validated, the methodology for how the target pathway was derived must be explained.
Finance team checklist for E1-4:
- Confirmed base year with a documented inventory for that year
- Absolute Scope 1+2 reduction target expressed as percentage from base year
- Scope 3 target or documented rationale for exclusion of specific categories
- Interim milestones (e.g., 2030 target en route to 2050 net-zero)
- Carbon credit use policy: are credits counted toward the target, and if so, under what conditions?
E1-5: Energy Consumption and Mix
E1-5 requires disclosure of total energy consumption in megawatt-hours (MWh), split by fossil fuels, nuclear, and renewable sources. The renewable energy breakdown should distinguish between self-generated renewables, renewable energy contracted directly via PPAs, and renewable energy certificates (RECs or GOs) — because these have different methodological standing under market-based Scope 2 accounting.
Common gap: Companies that use Energy Attribute Certificates (EACs) — such as European Guarantees of Origin or US RECs — to claim market-based zero-emission electricity often do not track the underlying physical energy consumption separately. E1-5 requires the physical fuel and energy mix, not just the market-based accounting output. Finance teams should ensure energy management systems capture consumption by source, not just total kWh.
E1-6: Gross Scope 1, 2, and 3 GHG Emissions
This is the quantitative core of the ESRS E1 disclosure. It requires absolute gross GHG emissions (before any carbon credits) for:
- Scope 1 (direct emissions): expressed in metric tonnes CO₂e using IPCC AR6 GWP100 values (CH₄ = 27.9, N₂O = 273)
- Scope 2 (indirect energy emissions): both location-based and market-based figures required — if these differ materially, the difference should be explained
- Scope 3 (value chain emissions): all material categories, with methodology (spend-based, activity-based, or supplier-specific) disclosed per category
Finance team checklist for E1-6:
- Organizational boundary documented (operational control or equity share method)
- Base year and comparative year emissions — year-on-year comparability requires consistent methodology; if methodology changed, a restatement policy must exist
- Emission factor sources cited for each scope (EPA eGRID for US grid electricity, IEA for international electricity, DEFRA 2024 for UK, Ecoinvent 3.10 for supply chain)
- Scope 3 category-level emissions with materiality rationale for excluded categories
- Biogenic carbon separately reported if material
E1-7: GHG Removals and Carbon Credits
This requirement keeps offset purchases and emission removals strictly separated from gross emission figures. Purchases of carbon credits, carbon removals from direct air capture, and LULUCF (land use, land-use change and forestry) credits are all disclosed here, not netted against E1-6 totals. The standard requires disclosure of the quantity, the registry and project standard used (Gold Standard, VCS, etc.), and whether credits are used to make a net-zero or neutrality claim.
E1-9: Anticipated Financial Effects of Climate-Related Risks and Opportunities
E1-9 is the most analytically demanding disclosure for most finance teams. It requires a description of climate-related physical and transition risks, the time horizon over which they are expected to manifest, and — where material — quantitative or semi-quantitative estimates of the financial impact. The TCFD-compatible scenario analysis underlying this disclosure requires at minimum a high-warming physical scenario (consistent with IPCC RCP6.0 or 8.5) and a low-warming transition scenario (consistent with 1.5°C or well-below 2°C).
What finance teams need: A climate risk register mapping physical risks (flood, heat stress, supply disruption) and transition risks (carbon pricing, policy changes, technology shifts) to business units, with financial exposure estimates. The financial exposure estimates do not need to be highly precise in the first reporting year — but they must be grounded in documented scenario assumptions and cannot be dismissed as immaterial without explanation.
We're not saying that a first-year ESRS E1 disclosure must achieve the depth of a mature TCFD report — the standard explicitly contemplates that companies will progressively improve disclosure quality. But it does require a genuine materiality assessment and documented basis for each disclosure item, not a generic "we consider climate change a risk" statement. The external assurance process under ISAE 3000/3410 limited assurance will probe the documentation behind each disclosure. Assembling that documentation now, systematically, against this checklist, is the difference between a first-year filing that passes assurance review and one that generates qualified findings.