23 Feb 2023
Companies will soon be required to publish detailed information on sustainability matters
On November 28th, 2022, the European Council gave its final approval to the Corporate Sustainability Report Directive (CSRD).
Companies will soon be required to publish detailed information on sustainability matters, reporting how their business model affects their sustainability, and how external sustainability factors such as climate change influence their activities.
The CSRD will fill the gaps in the existing rules on sustainability information; disclosure of sustainability information that is reliable, relevant, and comparable could attract additional investment and funding to facilitate the transition to a sustainable economy, as described in the European Green Deal.
How does it work the application of CSRD?
The application of the regulation will take place in four stages:
- reporting in 2025 on the financial year 2024 for companies already subject to the NFRD (Non-Financial Reporting Directive);
- reporting in 2026 on the financial year 2025 for large companies that are not currently subject to the NFRD;
- reporting in 2027 on the financial year 2026 for listed SMEs (Small and Medium sized Enterprises), small and non-complex credit institutions and captive insurance undertakings;
- reporting in 2029 on the financial year 2028 for third-country undertakings with net turnover above 150 million in the EU if they have at least one subsidiary or branch in the EU exceeding certain thresholds.
Which data shall be included in the sustainability reporting?
The sustainability reporting standards will have to specify the information about the following environmental factors:
- climate change mitigation, including emissions on scope 1 (directly generated by the company), scope 2 (created by the generation of the electricity or heat needed by the company to sell its main products or provide its main services) and, where relevant, scope 3 (caused by the entire value chain, including the end-user of the product over its life cycle) greenhouse gas emissions
- climate change adaptation
- water and marine resources
- resource use and circular economy
- biodiversity and ecosystems
Our Biodiversity and Ecosystem Services Team offers support for the development of the Non-Financial Disclosure to adhere to national and international laws and standards through services such as biodiversity impact assessments, field surveys and baselines and habitat and sensitivity mapping.