Welcome to Mon Entreprise Durable by Coptain! In short, our job is to enable CSR managers to amplify their impact! Today, we are exploring the Corporate Sustainability Reporting Directive (CSRD). The CSRD is a European standard aimed at improving the transparency and consistency of corporate sustainability reports. It replaces and expands on the previous directive, the Non-Financial Reporting Directive (NFRD), by requiring companies to disclose detailed information about their environmental, social, and governance (ESG) impact. This directive is essential for harmonizing reporting practices and strengthening investor and public trust. The entire team wishes you a great read!
The CSRD is having an impact on Swiss companies by extending the requirements for sustainable reporting.
Even non-EU members need to be prepared to remain competitive.
The CSRD is having an impact on Swiss companies by extending the requirements for sustainable reporting.
Even non-EU members need to be prepared to remain competitive.
This article explains how EcoVadis certification helps companies to structure, assess and improve their CSR practices, with a focus on continuous improvement.
Optimize your EcoVadis score with these 5 practices: understand the criteria, reinforce your CSR policies, involve the whole company, monitor actions and anticipate assessments.
Filling in an EcoVadis questionnaire is a strategic lever for enhancing your CSR commitment.
This article guides you in structuring your answers and achieving certification.
The CSRD, or Corporate Sustainability Reporting Directive, is a European directive that aims to standardize corporate sustainability reporting. It is managed by the European Union and is part of the European Green Deal, which aims to make Europe the first carbon-neutral continent by 2050. The CSRD was introduced to address the shortcomings of the previous directive, the NFRD, regarding the transparency and comparability of non-financial information disclosed by companies.
Historically, the NFRD was implemented in 2014 to require certain large companies to disclose non-financial information. However, it was criticized for its lack of clarity and harmonization. In response to these criticisms, the CSRD was adopted in 2021 to strengthen these requirements and include a greater number of companies within its scope.
The main objectives of the CSRD are to improve the quality and comparability of ESG information published by companies, increase transparency for stakeholders, and encourage companies to adopt more sustainable practices. The directive requires companies to disclose detailed information about their environmental, social, and governance impact, as well as their risks related to these areas. It also aims to integrate this information into annual reports so that it can be verified by independent third parties.
Key takeaway: The CSRD is a European directive aimed at standardizing and enhancing the transparency of corporate sustainability reports by expanding ESG disclosure requirements to improve data comparability and verifiability.
Compliance with the CSRD is particularly relevant for large publicly listed companies in the European Union, as well as those with a significant environmental or human rights impact. These companies must comply with enhanced reporting requirements to meet the growing expectations of investors and other stakeholders regarding transparency and corporate responsibility.
For companies operating in high-impact sectors, such as energy, manufacturing, or agriculture, compliance with the CSRD can help mitigate risks related to future regulations and market pressures.
By providing clear and comparable information on their ESG performance, these companies can strengthen their reputation and attract responsible investments. Additionally, for multinational companies with subsidiaries in the EU, complying with the CSRD is crucial to ensuring consistency in ESG reporting across their global operations. This not only enhances their brand image but also facilitates access to European markets, where ESG criteria have become a key factor in investment decisions.
The CSRD requires companies to disclose detailed information according to several key criteria:
• Environmental aspects: Companies must report on their greenhouse gas emissions, energy consumption, natural resource management, as well as their recycling and waste reduction initiatives.
• Social aspects: Reports must include information on respect for human rights, working conditions, and diversity and inclusion policies.
• Ethical aspects: Companies must detail their practices regarding financial transparency, anti-corruption efforts, and business integrity.
The evaluation methodology is based on a standardized framework that allows for comparison between companies. Reports must be audited by an independent third party to ensure their accuracy and compliance with EU-established standards. Unlike other CSR certifications that assign different levels (such as silver or gold), the CSRD does not operate on a rating system but instead requires full compliance with established criteria to be considered compliant.
Achieving compliance with the CSRD requires several key steps:
• Preparation: Companies must start by assessing their current ESG practices and identifying gaps compared to CSRD requirements. This includes a complete inventory of available ESG data and the establishment of a robust system for collecting this data.
• Application process: Although there is no formal “application” like for a traditional label, companies must prepare an annual report that complies with CSRD-defined standards. This report must be integrated into the annual financial report.
• Evaluation: Once the report is prepared, it must be audited by an accredited independent auditor who will ensure that all information is accurate and complies with the requirements.
• Post-certification monitoring: Companies must continue to monitor their ESG performance regularly to ensure continuous improvement. Reports must be updated annually.
• Cost and duration: The cost varies depending on the size and operational complexity but generally includes fees related to internal report development and external verification. The entire process can take several months depending on the initial level of preparation.
The CSRD significantly differs from other CSR certifications, such as Ecovadis or B-Corp, mainly due to its mandatory nature for certain companies within the EU.
The CSRD is particularly relevant for large listed companies or those with significant impacts, while Ecovadis can be chosen by any company seeking to improve its CSR performance, regardless of the regulatory framework.
To successfully comply with the CSRD:
• Best practices: Ensure that all your internal policies are well-documented and aligned with your ESG goals. Involve all stakeholders from the beginning of the process.
• Tools and resources: Use specialized software to track your ESG indicators or hire experienced external consultants who can guide you through the entire process.
• Training and awareness: Train your employees on the fundamental principles of sustainability so they better understand why these changes are necessary. Internal awareness is crucial to ensuring collective adherence to new initiatives.
In conclusion, complying with the CSRD offers several significant advantages:
• It improves your reputation among ESG-conscious investors.
• It helps you clearly identify your strengths and weaknesses so you can quickly implement effective corrective plans.
• It also facilitates your access to European markets, where these standards are becoming progressively mandatory and are even required by some major buyers.
Ultimately, investing in this compliance represents not only a strategic asset but also a strong commitment to a more sustainable future, both economically and environmentally!
Our job is to enable CSR managers to multiply their impact!
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