The new Corporate Sustainability Reporting Directive

All you need to know

On the 21st of April, the European Commission adopted a comprehensive package of measures to help improve the flow of money towards sustainable activities across the European Union. Included in this was a proposal for a Corporate Sustainability Reporting Directive (CSRD) which will replace the current Non-Financial Reporting Directive (NFRD).

In this proposal for the CSRD, the scope of companies falling under the legislation will be considerably expanded in comparison to the NFRD, going from 11.000 to almost 50.000 organizations in scope. Moreover, the detail of information that companies will need to report on will entail much more detail. This is linked to the development of the EU Sustainability Reporting Standard which is being developed by the European Financial Reporting Advisory Group (EFRAG).

The CSRD aims to:
  • Provide verifiable, accessible and coherent non-financial data to investors to allow for informed decision making.
  • Ensure consistency between non-financial and financial standards.
  • Help SME’s via proportionate disclosure requirements to become more attractive to investors.
What are the major new implications for reporters?
  • Detailed annual reporting on sustainability included in the management report.
  • Disclosure to be aligned with a new reporting standard published by the end of 2022.
  • Validation by an external party.
Authors
Lola Debersaques

Lola Debersaques

Partner, Sustainalize

Marleen Blanson Henkemans

Marleen Blanson Henkemans

Consultant, Sustainalize

Cedric Bodart

Cedric Bodart

Consultant, Sustainalize

Published on: 20 Mai 2021

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