With the Corporate Sustainability Reporting Directive (CSRD) and the interlinked European Sustainability Reporting Standard (ESRS) comes major changes that create a new paradigm for sustainability reporting. Reporting according to the ESRS is mandatory to all companies covered by the CSRD and must be incorporated in the management report. The reporting standard will also require companies to pay even more attention to traceability and transparency throughout the reporting process due to the limited assurance requirement.
The ESRS has a broader view of materiality than for example GRI, and is based on double materiality from an impact and financial perspective. The double materiality assessment will help companies to understand their impact, risks and opportunities spanning across their upstream and downstream value chains, arising from business relationships, geographical locations and more.
All companies covered by the CSRD (around 50 000 companies) will sooner or later be required to align their sustainability reports according to the ESRS. The CSRD covers all listed companies on regulated markets within the EU, including Small and Medium-sized Enterprises except micro companies. It also applies to all large (listed or not) companies if they meet at least two of the following three criteria:
And last but not least, non-EU undertakings with turnover above 150 million in the EU if they have at least one subsidiary or branch in the EU exceeding the above thresholds.
To prepare your organisation for the new sustainability reporting standard there are a number of measures you can take to make the adaptation as smooth as possible. The ESRS experts at Position Green can support you with:
There will be a gradual implementation of the ESRS, depending on the size of the company:
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