In today's post in our blog series on the European Sustainability Reporting Standards (ESRS), we look at the ESRS S1 standard, which covers the social topics relating to a company's own workforce and those not directly employed. This standard ensures that companies report transparently on the material social impacts, risks and opportunities arising from their employment practices.

What is ESRS S1?

ESRS S1 focuses on the social aspects related to a company's own workforce. The aim is to prevent or mitigate negative impacts on employees and to ensure that employee rights and social dialog are promoted. ESRS S1 includes both qualitative and quantitative disclosures that enable comprehensive reporting on a company's social performance and challenges.

Disclosure requirements include working conditions, respect for human rights, diversity and inclusion, appropriate remuneration, social protection and safety, and the management of material social risks and opportunities.

Disclosure requirements in accordance with ESRS S1

The reporting requirements under ESRS S1 are diverse and detailed in order to comprehensively highlight the social impacts within the company. An overview of the main disclosure requirements can be found here:

Synergies with other ESRS standards

ESRS S1 overlaps with other ESRS standards in many respects, in particular:

• ESRS S2 (Workforce in the value chain): This deals with the extended social impacts in the value chain.
• ESRS S3 (Affected Communities): Refers to the company's social impact on local communities.
• ESRS G1 (Governance): Governance standards relate in part to social aspects, particularly when it comes to human rights and equal treatment.

Challenges during implementation

The implementation of ESRS S1 is a major challenge, especially for multinational companies, as data collection and reporting on numerous social aspects in different regions and countries require considerable resources. In particular, issues such as gender-specific pay and compliance with human rights require detailed analysis and continuous monitoring.

Another critical aspect is compliance with data protection regulations, particularly in relation to diversity parameters and reporting on disabilities within the workforce. Companies must ensure that they reconcile data protection and transparency requirements.

Conclusion: The importance of ESRS S1

ESRS S1 is a key standard within the ESRS series as it focuses on the social impact of a company on its most important resource - its people. Comprehensive reporting on working conditions, diversity, remuneration and health and safety offers companies the opportunity not only to meet regulatory requirements, but also to improve their social practices and strengthen their employer brand.

By complying with ESRS S1, companies can make a positive contribution to social sustainability and at the same time increase their attractiveness as an employer. In future articles, we will dive deeper into the specific requirements of the social standards and provide practical examples of how companies can improve their reporting.

Outlook

Stay tuned for more articles that take a closer look at the social aspects of sustainability reports and offer practical tips for optimizing reporting.