{"id":3875,"date":"2025-02-23T23:00:00","date_gmt":"2025-02-23T23:00:00","guid":{"rendered":""},"modified":"2025-03-28T09:52:07","modified_gmt":"2025-03-28T09:52:07","slug":"corporate-sustainability-reporting-directive-new-and-greater-challenges-for-companies","status":"publish","type":"publicacion","link":"https:\/\/belzuz.com\/en\/publicacion\/corporate-sustainability-reporting-directive-new-and-greater-challenges-for-companies\/","title":{"rendered":"Corporate Sustainability Reporting Directive: New [and Greater] Challenges for Companies"},"content":{"rendered":"

The growing query for transparency and sustainable practices within the European business landscape culminated in the adoption of the Corporate Sustainability Reporting Directive (CSRD<\/strong>). This directive overhauls non-financial reporting obligations, significantly expanding the scope of companies subject to stringent disclosure requirements on environmental, social, and governance (ESG<\/strong>) factors. With a significant impact on compliance practices, this directive introduces more detailed and harmonized formalities, requiring adaptation.<\/p>\n

Scope of Application and Implementation Deadlines<\/strong><\/p>\n

The CSRD significantly expands the entities subject to sustainability reporting, replacing the previous Non-Financial Reporting Directive (NFRD<\/strong>). The new regime will be implemented progressively, depending on the type of entity:<\/p>\n

1. Companies previously covered by the NFRD<\/strong> (with more than 500 employees) \u2013 reporting is mandatory from the 2024<\/strong> financial year, with the first report published in 2025<\/strong>.<\/p>\n

2. Other large companies<\/strong> (meeting at least two of the three criteria: more than 250 employees, \u20ac40 million in net turnover, or \u20ac20 million in total balance sheet) \u2013 reporting required from the 2025<\/strong> financial year, with publication in 2026<\/strong>.<\/p>\n

3. Small and medium-sized listed companies<\/strong> (excluding micro-enterprises) \u2013 reporting mandatory from the 2026<\/strong> financial year, with the first publication in 2027<\/strong>. A transitional regime allows for an exemption until 2028<\/strong>.<\/p>\n

4. Non-EU entities listed on a regulated market in the EU<\/strong> (with a turnover exceeding \u20ac150 million in the EU, or with a subsidiary\/branch in the EU generating more than \u20ac40 million in turnover) \u2013 subject to reporting from the 2028<\/strong> financial year, with publication in 2029<\/strong>.<\/p>\n

Main Obligations and Impact on Compliance<\/strong><\/p>\n

The CSRD strengthens reporting obligations through European Sustainability Reporting Standards (ESRS<\/strong>). The first delegated act concerning the first set of standards is already available, consisting of 12 standards. These ESRS establish strict and uniform criteria for disclosing environmental, social, and governance information. Among the main compliance challenges are:<\/p>\n

\u2022 Integration of sustainability requirements into the business strategy<\/strong>, requiring a cross-cutting approach to risk management and corporate governance, which must be properly reflected in the management report.<\/p>\n

\u2022 Mandatory verification of information through a limited assurance audit<\/strong> of the company\u2019s sustainability report, including compliance with the reporting standards and the process implemented by the company to identify the reported information, in order to enhance reliability and transparency.<\/p>\n

\u2022 Adoption of the double materiality principle<\/strong>, implying analysis of both the financial impact on the entity and the impact on the environment and society.<\/p>\n

\u2022 Digitalization and interoperability of reports<\/strong>, with obligations for digital publication to facilitate access and comparability of information. Here, data and technology-related issues take center stage, which will be considered in the implementation of the CSRD, such as data collection, applied methodologies, processes and analysis, credibility and transparency, and IT systems and infrastructure.<\/p>\n

The complexity and rigor of this new regulatory framework require careful preparation, making it essential for the entities affected to invest in internal capacity building and the development of effective mechanisms to ensure compliance. Transparency and sustainability have ceased to be mere guiding principles and have become central elements of modern corporate governance.<\/p>\n

At we have a and lawyers specialized in these matters. We are attentive to new regulatory requirements, and based on our experience, we believe companies should prepare in a timely and proactive manner, establishing effective internal processes and ensuring compliance.<\/p>\n

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