Corporate Sustainability Reporting Directive – CRSD at a glance
The “CSRD” (Corporate Sustainability Reporting Directive), i.e., the guideline on corporate sustainability reporting, has just been adopted in Brussels. This means that from as early as 2024, sustainability indicators are to have a similarly high weighting as financial indicators, in that they are to be published together in the company’s management report.
Read this article to find out what you need to know about the CSRD to get started and how we can help you.
Is this a new development?
Companies have already had to report non-financial information on environmental protection, social responsibility, etc. since 2018 with the NFRD (Non-Financial Reporting Directive), but not to the extent and in the manner planned by the new CSRD. The new regulation will require more companies to report. The report content and the auditing obligation will also be expanded and a new standard will be introduced.
No need to worry
Many companies, particularly SMEs, feel unprepared for these changes and do not know what exactly they will have to do. We believe that the CSRD is not a cause for concern, but an opportunity for companies to be better prepared for the future.
What is the CSRD all about?
The aim of the CSRD is for companies to describe the consequences of their corporate actions for the environment and society, and to publish them in the management report together with the key financial figures. The European Sustainability Reporting Standards (ESRS), i.e. a unification of reporting standards, will make the data comparable between companies.
The two biggest changes will be the anchoring of a dual materiality and the introduction of the ESRS.
What is the double materiality?
The company must consider sustainability aspects from two perspectives. This will also change the materiality principle previously used in Germany:
The new principle explains which data is now relevant for the sustainability report and must therefore be published. This means that the company must report on anything that is either relevant from an environmental or social perspective, or for the company’s success, i.e., no longer just incidents which affect finances.
If the previous rules of the NFRD were taken strictly, only a few matters had to be reported, which will change as a result of the new principles of the CSRD. This extension will affect nearly 50,000 companies across Europe.
Which standards will be used in the future?
To ensure comparability and to publish all the desired data, a separate standard, the European Sustainability Reporting Standards (ESRS), will be published in the near future. The ESRS is still in draft form, but parts have already been released for comment, and clear directions are discernible. The new standard will not only address climate issues, but also topics such as pollution, water, biodiversity and circular economy. In addition, social sustainability will play a larger role, bringing issues such as occupational health and safety, as well as the role of governance, risk and compliance to the forefront.
Does the new directive have to be implemented immediately?
No, don’t worry. Implementation doesn’t have to happen immediately, since the new regulation will be realized into the European business landscape in stages over the next few years.
What does this mean for you and your company?
The CSRD presents an opportunity to start early and make sure that your business is set for the future. You can do that by identifying the relevant topics and contents early. This will make it easier to compile the data for the sustainability report later. Additionally, you can already start reporting on your sustainability activities and thereby win over potential customers and new employees.
How can you get started and how can P3 help?
We support you in creating simple status quo reports as well as compact sustainability reports, strategy development, CCF calculations including layout and communication of the final report:
In an initial discussion, we clarify the scope of the report: Do you wish to “only” adhere to the legal regulations, or do you want to use the report to communicate your sustainability activities in an appealing and motivating way? Together we will find the right model for you.
Structured project management is part of every cross-departmental task. We support you from start to finish with our team and establish the required structures & processes with you (AKVs, standard deadlines, project communication, etc.).
English or German? Internal or external? Print or digital? GRI-compliant? When creating any report, the framework conditions must be clarified at the beginning. With the help of our detailed reporting checklist, we create the report exactly as you want it.
LAYOUT & TEXT CREATION
You want to create a modern report that appeals to customers and employees and shows your sustainability activities in a target group-oriented way? Our communication experts from P3 KOMMLOFT support you with layout and text creation as well as internal and external communication.
Do you feel like getting started right away? So do we! Feel free to contact us personally.