CSRD: Corporate Sustainability Reporting Directive
On January 5, 2023, the new EU directive on sustainability reporting, the “Corporate Sustainability Reporting Directive” ((EU) 2022/2464), came into force. The CSRD replaces the previous “Non Financial Reporting Directive (NFRD)” and is a key instrument of the “EU Green Deal”. This pursues the goal of developing Europe into a climate-neutral continent by 2050 and aims to promote sustainable business practices. The new requirements for companies subject to reporting obligations are intended to increase the transparency, comparability and quality of sustainability reporting.
Even if the CSRD does not specify any concrete requirements with regard to sanctions for non-compliance, it is foreseeable that these will be tightened. This is because sustainability reporting is to be gradually placed on the same level as financial reporting and integrated into sanctioning regulations under commercial law.
Are you affected?
The CSRD Directive not only significantly expands the scope of reporting, but also greatly expands the group of users. First of all, the previous group of users of the NFRD will fall under the new legislation (around 11,000 across Europe), followed by other large companies that will have to publish a report in accordance with the CSRD as early as the 2025 financial year. Even SMEs with 10 or more employees may be subject to the reporting obligation from 2026 under certain conditions.
However, even companies that will not be subject to the reporting obligation until the following years must already deal with the requirements, as the changes are extensive compared to the previous legislation and the corresponding implementation and research are complex and time-consuming.
What challenges do you face?
A key innovation is the concrete specification of the report content and structure in accord-ance with the uniform European reporting standards, the European Sustainability Reporting Standards (ESRS). With over 1000 data points, these provide a flood of information that must be collected by companies subject to reporting requirements over time and integrated into the sustainability report.
In addition, a “materiality assessment” must be carried out to determine which sustainability topics are relevant for the company and therefore need to be reported. Material sustainabil-ity topics are identified according to the Principle of double materiality (impact materiality and financial materiality):
In particular, the process and precise documentation of the materiality assessment pose ma-jor challenges for many companies due to the imprecise explanations in the legal text.
How can tec4U-Solutions support you?
CSRD consulting
tec4U-Solutions supports you in implementing the mandatory sustainability reporting for your company in a targeted and economical manner.
As part of a workshop lasting several days, the topics relevant to you for your sustainability report are developed in cooperation with the specialist departments and the necessary information and data points are identified on this basis.
The CSRD workshop provides you with the following results:
CSRD software
The CSRD module within our sustainability compliance software DataCross enables you to carry out the materiality assessment semi-automatically and to identify the topics relevant to you by answering specific questions. A preliminary structure is then created for the individual sustainability report, which can be filled with content. To gather information, the application offers a supplier survey module and provides performance values from other DataCross modules on topics such as material compliance, supply chain due diligence and CO2 calculations (available at the end of 2024).
Our CSRD solution offers you the following advantages:
Any questions?
We are looking forward to your contact.
Gülistan Dar
We look forward to supporting you.