ESMA advises narrowing the taxonomy OpEx measure to R&D spending

The European Securities and Markets Authority has advised the European Commission to narrow the mandatory operating expenditure measure in EU taxonomy reports to non-capitalised research and development spending, the regulator said on 29 October on publishing its final technical advice.

The advice is a proposal, not a rule. The Commission asked the European Supervisory Authorities for it on 4 March 2026 for its review of the Taxonomy Disclosures Delegated Act, and ESMA consulted from 1 July to 12 August. Until the Commission amends the act, companies report under the current rules. The Omnibus Delegated Act already simplified those with a 10 per cent materiality threshold below which companies need not assess the eligibility and alignment of activities, shorter templates and a deferral to 2028 of some financial undertakings' measures, the final report says.

Non-financial companies disclose three key performance indicators: the share of their turnover, capital expenditure (CapEx) and operating expenditure (OpEx) that is taxonomy-eligible and taxonomy-aligned. The report covers non-financial companies listed on EU regulated markets and asset managers, and says its considerations for listed companies can be extended to unlisted companies within the scope of taxonomy reporting. That includes companies listed in Poland, Czechia, Hungary and Romania, such as those on the Warsaw exchange, which moved its trading to a new system this month.

Respondents to the consultation said the current OpEx measure imposes a disproportionate burden and adds little to the turnover and CapEx figures, and the most support went to limiting mandatory reporting to research and development spending, the report says. ESMA would keep the existing materiality reliefs and does not recommend prescribed rules for a voluntary, wider "OpEx+" measure; it asks instead that the status of voluntary taxonomy disclosures be clarified, with safeguards on reconciliation, transparency, comparability and greenwashing risk. For use-of-proceeds spending under the EU Green Bond Regulation it would keep a broader, simplified notion of OpEx. It recommends monitoring the revised measures for five years.

For groups, the authorities recommend removing the requirement to calculate a weighted-average indicator and setting the main reporting regime mainly by the nature of the parent, with a specific rule for financial conglomerates. Secondary businesses of a different nature would give simplified disclosures. ESMA raises the possibility of a cumulative materiality threshold of 10 per cent below which those disclosures could be left out, and for non-financial secondary businesses only the headline turnover and CapEx eligibility and alignment figures, with short contextual information. The authorities do not recommend letting financial undertakings, asset managers in particular, use their counterparties' OpEx figures in their own reports.

ESMA also recommends optional reliefs for acquisitions, disposals, omitted information and comparative information; cross-references to disclosures under the European Sustainability Reporting Standards; a one-year phased application of amendments; and eligibility-only reporting in the first financial year for newly introduced activities and first-time reporters. It would remove the adjusted turnover measure for sustainable bonds and make the disclosure of turnover from internal sales voluntary.

For audit committees of listed companies the advice changes nothing in the reports now being prepared; the date that matters is the Commission's revision of the delegated act, with the one-year phase-in ESMA proposes. ESMA's final report of 16 October on guidelines for delaying the disclosure of inside information added, among five new cases, a board appointment the appointee has not yet told their current employer about, with the other conditions for delay still applying.