How to Report Under ESRS E4: Biodiversity and Ecosystems for Non-Big 4 Auditors

Why ESRS E4 is the standard most clients want to skip

Biodiversity is the ESRS topic where the gap between regulatory ambition and corporate readiness is widest. ESRS E1 (Climate Change) has years of TCFD reporting behind it. ESRS E2 (Pollution) maps onto existing environmental permits. ESRS E3 (Water) connects to measurable utility data. ESRS E4 asks companies to assess their relationship with ecosystems, species, and habitat conditions across their entire value chain, using frameworks and data sources that most mid-sized European companies have never touched.

The result is predictable. Companies that have no difficulty producing climate disclosures freeze when they reach biodiversity. The DMA identifies potential materiality based on site proximity to protected areas, but the sustainability team lacks the ecological expertise to evaluate what that proximity means. The assurance team faces the same gap. You know how to test a carbon emissions calculation. You probably haven’t tested a habitat connectivity assessment before.

ESRS E4 paragraph 1 states that the standard covers four closely interlinked sub-topics: drivers of biodiversity and ecosystem change, the state of species, the condition and extent of ecosystems (terrestrial, freshwater and marine), and ecosystem services. Paragraph 7 adds that context-specific considerations are particularly important for biodiversity because material impacts are almost always geographically specific. A company with 20 sites may find that biodiversity is material for two of them and irrelevant for the other 18. ESRS E4 acknowledges this through ESRS 1’s aggregation and disaggregation provisions (Chapter 3.3.2).

The interaction with other environmental standards is more complex here than for any other E-standard. ESRS E4 paragraph 5 maps the connections: climate change impacts on biodiversity go under E1; pollution impacts on ecosystems go under E2; water-use impacts on ecosystems go under ESRS E3; and resource extraction impacts connect to E5. ESRS E4 covers land-use change, freshwater-use change, sea-use change, direct exploitation of organisms, and invasive alien species as the direct drivers within its scope.

How the materiality assessment works for biodiversity

ESRS E4 AR 6 directs the undertaking to assess materiality using the first three phases of the LEAP approach: Locate, Evaluate, Assess. The amended ESRS removed the E4-specific IRO-1 disclosure requirement (consolidating it into ESRS 2), but the LEAP methodology remains the recommended assessment structure.

Phase 1: Locate the interface with biodiversity

ESRS E4 AR 7 describes Phase 1 as identifying the relevant sites where the undertaking’s operations interact with biodiversity and ecosystems. In practice, this means mapping every operational site (and material supplier sites, where data exists) against biodiversity-sensitive areas.

The standard references several databases for this screening. Protected areas include Natura 2000 sites (under the EU Habitats Directive 92/43/EEC and Birds Directive 2009/147/EC), nationally designated protected areas, and UNESCO World Heritage sites. Key Biodiversity Areas (KBAs) maintained by the IUCN are also relevant. The WWF Biodiversity Risk Filter, released in version 2.0 in September 2024, is a free tool that overlays operational site coordinates against these datasets.

The amended ESRS introduced the concept of “area of influence” to assess whether a site is considered near a biodiversity hotspot. This is a practical improvement. Under the original standard, “near” was undefined, leaving companies to make judgment calls about buffer distances. The area of influence concept asks whether the site’s activities could reasonably affect the biodiversity-sensitive area, considering factors like water flow direction, air pollution dispersion, and noise.

For your assurance procedures, Phase 1 produces a concrete output: a list of sites with their coordinates, the biodiversity-sensitive areas within each site’s area of influence, and the data source used for the screening. If this list doesn’t exist, the DMA is incomplete.

Phase 2: Evaluate dependencies and impacts

ESRS E4 AR 8 covers the evaluation of the undertaking’s dependencies on ecosystem services and its impacts on biodiversity. Dependencies include things like pollination services for agricultural supply chains, water purification services for manufacturing, and soil stability for infrastructure. Impacts include land-use change, habitat fragmentation, species disturbance, pollution, and introduction of invasive species.

ESRS E4 AR 4 lists the sub-topics the materiality assessment should cover. These include the undertaking’s contribution to direct impact drivers on biodiversity loss (as defined by IPBES), impacts on the extent and condition of ecosystems (including land degradation, desertification and soil sealing), and impacts on threatened species. Under the amended ESRS, this list was retained but the mandatory datapoints associated with each sub-topic were significantly reduced.

Phase 3: Assess material risks and opportunities

Phase 3 (ESRS E4 AR 9) converts the evaluation into a determination of which impacts, dependencies, risks and opportunities are material. This uses the double materiality assessment criteria from ESRS 1 Chapter 3: impact materiality (assessed by severity, using scale, scope and irremediability) and financial materiality (assessed by the potential effect on the undertaking’s financial position and performance).

A company can conclude that biodiversity is not material. ESRS E4 explicitly allows this. But the conclusion must be supported by a DMA that actually ran through the LEAP phases with site-specific data. A DMA that says “we are a services company with office-based operations, therefore biodiversity is not material” is defensible only if the undertaking checked whether any office site sits within the area of influence of a biodiversity-sensitive area. If it does, the conclusion needs more work.

The five disclosure requirements after the Omnibus amendments

The amended ESRS E4 contains five disclosure requirements, down from six in the original (E4-6, Anticipated Financial Effects, was deleted). Each one was simplified in the December 2025 technical advice.

E4-1: Biodiversity and ecosystems transition plan

ESRS E4 paragraph 11 (amended) requires disclosure of a biodiversity transition plan. The critical change under the Omnibus amendments: this is now conditional. The undertaking only discloses a transition plan if it has one in place, or if it has made public the key features of such a plan. ESRS E4 no longer mandates that an undertaking create a biodiversity transition plan solely for reporting purposes.

For most non-Big 4 clients, this is the biggest practical change. If your client has no biodiversity transition plan (and most mid-sized companies don’t), E4-1 reduces to a brief statement that no plan exists. The amended standard removed the strategy resilience provisions that previously sat in E4-1, moving them to ESRS 2 SBM-3. If the client does have a plan, it must describe how the plan aligns with the Kunming-Montreal Global Biodiversity Framework’s goal of halting and reversing biodiversity loss by 2030.

E4-2: Policies related to biodiversity and ecosystems

ESRS E4 paragraph 20 requires disclosure of biodiversity policies, following ESRS 2 GDR-P. The E4-specific additions require the undertaking to describe whether its policies support traceability of products and raw materials with material impacts on biodiversity, and whether they address production or sourcing from ecosystems managed to maintain or enhance biodiversity conditions.

The amended ESRS streamlined E4-2 to reference ESRS 2 GDR-P as the baseline, with retained specifications on traceability and on sites near biodiversity-sensitive areas. Other policy details moved to non-mandatory illustrative guidance. ESRS E4 AR 11 notes that biodiversity policies may be integrated into broader environmental or sustainability policies rather than standing alone.

For your engagement, the key test is whether the policy exists and whether it covers the material impacts identified in the DMA. If the DMA identified land-use change at a specific site as a material impact, the policy needs to address land-use management at that site. A generic statement about “respecting biodiversity” won’t satisfy the disclosure requirement.

E4-3: Actions and resources

ESRS E4 paragraph 25 requires disclosure of actions and resources related to biodiversity. The amended ESRS simplified this to reference ESRS 2 GDR-A, with a retained focus on biodiversity offsets. If the undertaking uses biodiversity offsets as part of its approach, E4-3 requires specific disclosure of how those offsets work and how they are integrated into the mitigation hierarchy (avoid, minimise, restore, offset).

ESRS E4 AR 6 for paragraph 13 (in the amended numbering) adds that actions must consider the right to free, prior and informed consent of indigenous peoples, cross-referencing ESRS S3. This is unlikely to be relevant for most Dutch or German mid-market clients, but it applies to any undertaking with operations or supply chains in regions where indigenous land rights exist.

E4-4: Targets related to biodiversity and ecosystems

ESRS E4 paragraph 29 requires disclosure of biodiversity-related targets, following ESRS 2 GDR-T. The undertaking must specify whether ecological thresholds were applied in target-setting, whether targets align with the Kunming-Montreal GBF or the EU Biodiversity Strategy for 2030, and whether biodiversity offsets were used.

Paragraph 32 lists the specific information the target disclosure must include: whether thresholds were applied (and if so, the methodology), whether they are entity-specific, the geographical scope, and to which layer of the mitigation hierarchy each target can be allocated. The amended ESRS simplified the ecological threshold requirements, moving some specifications to ESRS 2 GDR-T, but the core content survived.

ESRS E4 AR 26 provides examples of measurable targets: size and location of protected or restored habitat areas, recreated surfaces, or percentage of projects whose ecological integrity improved (fish passes, wildlife corridors). These examples give you concrete benchmarks for evaluating whether your client’s targets are specific enough to satisfy the disclosure requirement.

E4-5: Impact metrics related to biodiversity and ecosystems change

ESRS E4 paragraph 36 (original numbering) requires the undertaking to report metrics related to its material impacts on biodiversity. The amended ESRS consolidated the site-specific provisions that previously sat across various E4 sections into the metrics section, using “location” rather than “site” for flexibility in aggregation.

If the undertaking identified sites in or near biodiversity-sensitive areas with negative impacts (per the DMA), it must disclose the number and area (in hectares) of those sites. This is the hard metric in E4. It requires a GIS-based or equivalent spatial analysis that links operational sites to protected areas and KBAs. The amended ESRS confirmed that aggregation across sites is acceptable when it improves clarity, but the site-level data must underpin the aggregate.

Additional metrics under E4-5 are more flexible. The undertaking may report on ecosystem extent and condition changes, species-level indicators (referencing the IUCN Red List and the European Red List), or habitat connectivity metrics. The “may” language here reflects the amended ESRS’s shift from prescriptive metric lists to a principles-based approach focused on material impacts.

What changed under the December 2025 amendments

ESRS E4 received the largest reduction of any topical standard under the Omnibus simplification. The ERM analysis identified a 77.8% reduction in mandatory datapoints. The word count of the standard fell by 78%. Four changes matter most for your engagements.

The transition plan became conditional. Under the original ESRS E4, the transition plan disclosure was mandatory regardless of whether the undertaking had a plan. The amended version requires disclosure only if a plan exists or has been publicly communicated. This removes the single largest burden for companies at an early stage of biodiversity maturity.

E4-IRO-1 was removed. The materiality assessment process disclosure consolidated into ESRS 2. The LEAP approach guidance moved to non-mandatory illustrative guidance. Companies can still use LEAP (and many will), but they’re no longer required to structure their IRO-1 disclosure around it.

E4-6 (Anticipated Financial Effects) was deleted. EFRAG cited methodological immaturity. The biodiversity-finance nexus is too undeveloped for mandatory quantification. Any financial effects disclosure now falls under ESRS 2’s general provisions.

Metrics were consolidated around location-based impacts. Rather than a long list of optional indicators, E4-5 now focuses on where material impacts occur, what activities cause them, and whether biodiversity-sensitive areas are affected. The amended ESRS introduced the “area of influence” concept and clarified that site-level data can be aggregated when this improves readability.

The net effect for a non-Big 4 auditor: ESRS E4 went from being the most daunting environmental standard to report under to something closer to a structured site-screening exercise with policy and target disclosures attached. If your client has no sites near biodiversity-sensitive areas and no material biodiversity impacts in its value chain, the E4 section of the sustainability statement can be relatively brief (the DMA conclusion plus the basis for that conclusion). If sites are near sensitive areas, the disclosure requirements are specific but bounded.

Worked example: Brouwer Vastgoed B.V.

Brouwer Vastgoed B.V. is a commercial real estate company based in ’s-Hertogenbosch, Netherlands, with €94M revenue and a portfolio of 12 logistics warehouses across Noord-Brabant and Limburg. Two warehouses sit within 1 km of Natura 2000 areas (one near the Loonse en Drunense Duinen, one near the Groote Peel). The company has no biodiversity policy, no transition plan, and has never performed a biodiversity assessment.

Step 1: Materiality assessment (LEAP Phase 1)

Brouwer’s external sustainability consultant maps all 12 warehouse locations using the WWF Biodiversity Risk Filter. Two sites flag as high-risk due to proximity to Natura 2000 areas. The Loonse en Drunense Duinen site is 650 metres from the protected area boundary. The Groote Peel site is 900 metres away. Both sites have paved surfaces, external lighting, and stormwater discharge infrastructure.

Step 2: Evaluate and assess (LEAP Phases 2 and 3)

For the two flagged sites, the consultant evaluates potential impacts. External lighting at the Loonse en Drunense Duinen site may affect nocturnal species (the area is designated partly for its bat populations). Stormwater runoff from the Groote Peel site discharges into a ditch that feeds into the peatland ecosystem. The Groote Peel is a Ramsar wetland. Impact materiality assessment: the lighting impact is moderate-scale, limited-scope. The stormwater impact is potentially higher because peatland ecosystems are sensitive to nutrient loading. Financial materiality: regulatory risk exists because the Province of Noord-Brabant has tightened permit conditions for developments near Natura 2000 areas. Brouwer concludes biodiversity is material for these two sites.

Step 3: Disclosure (E4-1 through E4-5)

E4-1: Brouwer has no biodiversity transition plan. Under the amended ESRS, the disclosure is a statement that no plan exists. No further detail is required for E4-1.

E4-2: Brouwer has no standalone biodiversity policy. The disclosure states this fact. Because the DMA identified material impacts at two sites, the sustainability statement should note the absence of a policy and, if applicable, describe any intent to develop one.

E4-3: In 2024, Brouwer installed bat-friendly LED lighting at the Loonse en Drunense Duinen site (€18,000 investment) and commissioned a stormwater quality assessment at the Groote Peel site (€7,500). The stormwater assessment found elevated phosphate levels in runoff. A filtration retrofit is planned for 2025 (estimated €45,000).

E4-4: Brouwer has set no formal biodiversity targets. The disclosure states this. Under GDR-T, if no targets exist, the undertaking may explain why and whether it plans to set them.

E4-5: Two sites are within the area of influence of Natura 2000 areas. Total area: 24,600 m² (Loonse en Drunense Duinen site: 15,200 m²; Groote Peel site: 9,400 m²). The metric disclosure states the number of sites (2), the total area in hectares (2.46 ha), and the nature of the biodiversity-sensitive areas affected.

The resulting ESRS E4 section for Brouwer is honest about the company’s early-stage position. Two sites have identified impacts. One concrete action has been taken (lighting retrofit). One assessment is complete (stormwater). No policy, no transition plan, no targets. Under the amended ESRS, this is acceptable disclosure. The standard doesn’t require the company to have a mature biodiversity programme. It requires the company to disclose what it has, what it found, and what it did.

Practical checklist for your next CSRD engagement

1. Screen every operational site against the IUCN Key Biodiversity Areas database, the Natura 2000 network, and nationally designated protected areas. The WWF Biodiversity Risk Filter (version 2.0, September 2024) overlays all of these in a single free tool. ESRS E4 AR 7 expects site-level screening as the starting point for the materiality assessment.
2. For any site within the area of influence of a biodiversity-sensitive area, document the impact pathway (what activity at the site could affect what ecological feature of the protected area). The “area of influence” concept in the amended ESRS requires a causal link, not just proximity.
3. Check whether the client has a biodiversity transition plan. If not, confirm that the E4-1 disclosure simply states the absence of a plan. Under the amended ESRS E4 paragraph 11, no further disclosure is required for E4-1 in this case.
4. For E4-5 metrics, verify the site area figures (in hectares) against cadastral records, property deeds, or lease agreements. Verify the biodiversity-sensitive area designations against official databases (Natura 2000 database for EU designations, national databases for other protected areas). ESRS E4 paragraph 36 requires disclosure of both the number of sites and the total area.
5. If the client uses biodiversity offsets (in either its actions under E4-3 or its targets under E4-4), check that the offset mechanism is described and that it specifies where the offset sits in the mitigation hierarchy. The amended ESRS retained the offset disclosure requirement while simplifying other aspects of E4-3 and E4-4.
6. Cross-check ESRS E4 disclosures against E1 (climate adaptation impacts on ecosystems), E2 (pollution impacts on biodiversity), E3 (water-use impacts on ecosystems), and S3 (community impacts from ecosystem degradation). ESRS E4 paragraph 5 maps these interactions explicitly.

Common mistakes in first-year ESRS E4 filings

• Concluding biodiversity is not material without site-level screening: The most common shortcut is sector-based reasoning (“we’re a financial services firm, biodiversity doesn’t apply”). ESRS E4 AR 7 requires site-level assessment. An investment fund that owns commercial real estate near protected areas has a biodiversity interface regardless of its sector classification. EFRAG’s December 2025 technical advice retained this site-level expectation.
• Disclosing a biodiversity transition plan that doesn’t exist yet: Under the original 2023 ESRS E4, some companies drafted transition plans specifically for the sustainability statement. The amended standard makes E4-1 conditional on the plan already existing. If the client created a plan solely for CSRD reporting purposes, check whether it represents a genuine strategic commitment or a disclosure artefact.
• Reporting hectares without verifying the underlying data: E4-5 requires the area of sites in or near biodiversity-sensitive areas. Some companies estimate site areas from satellite imagery or internal records that don’t match cadastral data. A 20% discrepancy in site area is a finding in your assurance procedures. Property records are the authoritative source.

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Further reading and source references

• ESRS E4, Biodiversity and Ecosystems: the topical standard governing biodiversity-related disclosures under the CSRD.
• ESRS 1, General Requirements: governs materiality assessment, aggregation principles (Chapter 3.3.2), and severity criteria (Chapter 3).
• Kunming-Montreal Global Biodiversity Framework (December 2022): the international framework referenced in E4-1 for transition plan alignment.
• WWF Biodiversity Risk Filter (version 2.0, September 2024): the free GIS tool for screening operational sites against biodiversity-sensitive areas.