Blog Post | January 18th 2023 | Lorenzo Roveda

CSRD Unpacked - What you need to know to be able to report for 2024

CSRD - The obligation

The CSRD, or Corporate Sustainability Reporting Directive, is quickly approaching and companies with more than >500 employees subject to NFRD (>250) will have to report on it for 2024 (2025). If you are completely new to the topic we suggest you start by reading our previous blog post: CSRD - What is it?

In this blog post, we'll guide you through the most important CSRD points, covering the general structure, main requirements, and principles, so that you can get a head start and organize your efforts accordingly.

ESRS & key documents of reference

📃The main reference documents for CSRD are the latest ESRS drafts of sector-agnostic standards from EFRAG, which were approved and delivered to the EU Commission in November 2022.

📃 EFRAG is now developing sector-specific and SMEs-specific standards which will be published this spring (from April 2023).

(ESRS=European Sustainability Reporting Standards, EFRAG is the European entity writing them)

CSRD structure

The ESRS are composed of:

• 2 standards which are general and overarching (cross-cutting): standards ESRS 1 & 2
• 10 standards which are developed for 10 specific topics (topical) across Environment, Social and Governance.

💡Each standard contains multiple Disclosure Requirements (or DR e.g. ESRS E1 has 9 DRs).

CSRD Datapoints & Disclosure Requirements (DRs)

When reporting on CSRD, each company has to report on disclosure requirements (DRs) and datapoints that can be either:

• Mandatory: apply to everyone
• Material: based on the company’s double-materiality assessment

Mandatory ESRS Datapoints

• ESRS 2 General disclosures: it covers the company’s governance, strategy and the process to identify impacts, risks and opportunities.
• ESRS E1 Climate change: 9 DR including policies, actions and targets on climate change, energy consumption and mix, GHG emissions scope 1-2-3 [...].
• Datapoints prescribed by EU law (Appendix C ESRS 2): 67 datapoints from SFDR (e.g. Board's gender diversity, Policies to address deforestation), EU Climate law (e.g. GHG removals and carbon credits), CDR 2020 etc.
• ESRS S1: S1-1 to S1-9 (only with >250 employees).

Material DRs & Datapoints

On top of the mandatory DRs and datapoints, the ESRS requires conducting a double materiality assessment and to report on the material DRs and datapoints.

If a sustainability matter is considered material, it has to be reported. Here is quick schema summarizing the above to visualize that needs to be disclosed.

Based on November 22 drafts, ESRS 1 Appendix F

Publishing the CSRD-compliant report in ESEF

• Sustainability statements will have to be published in ESEF format (European Single Electronic Format) which is the European format of a machine-readable transmission of business report data to the European institutions.
• The report will have to be audited by a third party.
• Companies will have a maximum of 3 years to include their full value chain in the disclosure (phase-in period).

At ROSE, we have been working with more than 40 companies on their sustainability strategy and are building the platform our customers asked us for to navigate sustainability easily. We’d be happy to discuss how we can help you tackle the increasing complexity of sustainability requirements and even have some fun in the process! 😉

Align your sustainability strategy with the CSRD.

Download the Sustainability Strategy Checklist