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CSRD, how—in 300 words

Between 2024 and 2028/2029, nearly 50,000 companies—large and small, listed and non-listed—in the EU (see our blog post 'CSRD, who, and when—in 200 words') will have to start reporting their sustainability approach and performance using the European Sustainability Reporting Standards (ESRS) under the Corporate Sustainability Reporting Directive (CSRD) (see our blog post 'CSRD, what is it—in 200 words').

There are two aspects to the how: 

  • how to get to the content right

  • how to communicate the disclosures to stakeholders

To get to the correct disclosures, entities must perform a double materiality assessment, create transition plans, develop policies, determine gaps in the information they need to collect, and most likely implement ESG data management systems that help gather, cleanse, calculate, and consolidate the performance metrics, with the guidance provided by the European Sustainability Reporting Standards (ESRS) (application) requirements and with or without the help of external consultants—and you will have noticed that there are lots of them around.

And there is the how to (best) communicate your sustainability approach and performance to stakeholders.

Smaller companies that do not currently publish an annual report will probably create a stand-alone sustainability report, and large companies will include the additional content in their annual report. Initially, the ESRS disclosures will be in PDF format, but from 2025/2026, they must also be tagged and published in the machine-readable European Single Electronic Format (ESEF). (Stay tuned for our blog post 'CSRD, why machine-readable—in 200 words'.)

From an accessibility and engagement perspective, companies should consider a multi-channel approach to communicating with their multi-stakeholder audience, including investors, employees, customers, civil societies, and the general public. This broader audience will look for information online and expect to read a company's sustainability strategy on a website version (microsite) of the report—and not have to download a PDF. For viewing and accessing the ESG performance, a 'data center' could be offered, with interactive charts and data downloadable in Excel format, providing the best transparency and accessibility.