EU banking supervisor The European Banking Authority (EBA) provided an update to its ongoing initiative to simplify EU supervisory reporting requirements, indicating that it plans to postpone the implementation of its simplified ESG reporting measures for banks by more than a year to late 2028.

According to the EBA, the delayed implementation follows feedback and dialogue with the banking industry on the proposed changes, with the regulator now planning to release a finalized proposal package later this year with additional simplification measures and extended timelines.

The ESG simplification proposals form part of a series of measures launched by the EBA in April 2026 to reduce the reporting burden for banks, while ensuring that supervisory authorities continue to receive the information they need to fulfil their supervisory responsibilities.

In 2024, the EU published a new Banking Package (CRR3), which included changes to reporting requirements for banks beginning in 2025, including separate disclosure of environmental physical and transition risks, and their social and governance risks, total exposure to fossil fuel sector entities, and disclosures on how institutions integrate the identified ESG risks in their business strategy and processes, and governance and risk management. The banking package also extended the scope of ESG risks-related disclosures from only large institutions to all institutions, in areas such as environmental physical risks and transition risks.

Following the launch of the European Commission’s Omnibus initiative to reduce the sustainability reporting and regulatory burden on companies, the EBA launched a consultation in May 2025 exploring its own proposed amendments to banks’ Pillar 3 ESG reporting requirements, which included simplifications and clarifications around ESG risk-related reporting. The April 2026 proposals effectively provided a parallel framework for supervisory reporting requirements.

The ESG-related proposals included in the EBA’s package included the introduction of a proportionality-based framework, setting out different obligations for large listed and non-listed institutions, other listed institutions and large subsidiaries, and small and non-complex institutions (SNCIs) and other non-listed institutions.

For smaller institutions, the proposal reduced supervisory reporting to one template, with requiring annual reporting on climate change-related physical and transition risks in a simplified format relative to larger banks, and removing information on GHG financed emissions.

For larger banks, simplification measures included the removal of EU Taxonomy-related templates, including the removal of the Banking Book Taxonomy Alignment Ratio (BTAR) template from the supervisory reporting framework, while the supervisory reporting requirements were largely aligned with the Pillar 3 ESG disclosure framework to minimize duplication. The package also added two new supervisory-specific templates, however, including one on environment-related corporate exposures, and one on exposure to environmental risks beyond climate.

Feedback from industry groups such as the Association for Financial Markets in Europe (AFME) and the European Savings and Retail Banking Group (ESBG), however, called for more meaningful simplification measures from the EBA, included suggestions to extend the timeline of the new requirements.

In its update, the EBA said that it expects to publish its final draft package of revised supervisory reporting standards in December 2026, which will include further simplification of reporting templates, specifically noting reductions in ESG-related reporting, and longer implementation timelines, including a delay of the first reporting reference date for ESG-related supervisory reporting from September 2027 to December 2028.