CSRD (Corporate Sustainability Reporting Directive)
EU law for mandatory sustainability reporting by large companies.
What is CSRD (Corporate Sustainability Reporting Directive)?
The Corporate Sustainability Reporting Directive (CSRD) is a European Union law that significantly expands and strengthens the rules on social and environmental information that large companies must report. It requires affected companies to report on their sustainability impacts and risks, including climate-related data, in a standardized and audited manner, as part of their management report.
Why is CSRD (Corporate Sustainability Reporting Directive) important?
The CSRD is important because it drives greater transparency and accountability in corporate sustainability performance across the EU. By mandating comprehensive, comparable, and assured sustainability reporting, it helps investors, consumers, and other stakeholders make more informed decisions, channels finance towards sustainable activities, and encourages companies to accelerate their transition to a sustainable economy.
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Frequently asked questions
It applies to all large companies and all listed companies (except micro-undertakings) in the EU, including non-EU companies with significant activity in the EU. This extends coverage significantly beyond the previous NFRD.
The CSRD is being phased in, with the first companies (those previously under NFRD) required to report for financial year 2024, with reports due in 2025.
It requires reporting on a broad range of environmental, social, and governance (ESG) matters, including climate change (emissions, risks, opportunities), biodiversity, water, circular economy, own workforce, value chain workers, affected communities, and business conduct.