The European Union’s Corporate Sustainability Reporting Directive (CSRD) is a crucial piece of legislation that's reshaping the landscape of corporate responsibility. Starting from January 5, 2023, it's been changing how companies in Europe report on their impact on society and the environment. Let’s explore how your company can not only comply but excel under this new directive, and what measures you can take to connect the reporting to your core processes seamlessly.
What is CSRD?
CSRD is a new set of rules that help everyone understand how companies are doing in terms of being friendly to the planet and society. It stems from the European Green Deal, aiming to make environmental and social reporting as important as financial reporting. This means if you're a large company in the EU, you need to start reporting on things like how you affect nature, water resources, and local communities, for example.
Here's When It Kicks In:
- 2024: Companies already under the Non-Financial Reporting Directive (NFRD).
- 2025: Medium and large companies.
- 2026: Listed SMEs.
- 2028: Certain non-EU companies.
Getting on board with CSRD early can bring benefits like saving costs and finding new ways to innovate in your production process. However, it also means you'll face handling a lot of data and information early on, which can be quite a task.
Making CSRD easier: Your 5-step guide
There are five key actions to streamline CSRD reporting in your business:
- Identify key areas: Figure out what environmental, social, and governance factors matter most for your business. Here is where you can find more information on the European Sustainability Reporting Standards (ESRS).
- Collect and measure data: Gather information on these factors according to EU standards.
- Engage stakeholders: Talk to people who have a stake in your company to get their views on your sustainability efforts.
- Prepare and assure your report: Put together your sustainability report, making sure it follows the required standards.
- Communicate: Share your findings with everyone who needs to know and submit it to the EU if needed.
Streamlining with tech: No-code + expertise
Handling all these metrics and data can be overwhelming, right? Here's where technology can be a lifesaver. You can build a custom tool to make this whole process smoother.
There are complete solutions out there that are a good match for enterprises, but these can be unaffordable to small and medium sized businesses. For companies that do not have a lot of experience with CSRD reporting yet, the combination of a customizable no-code tool and specialist consultancy offers a powerful solution.
Automating core processes with a no-code tool
Starting with the configurational aspects, setting up a comprehensive framework for CSRD compliance involves more than just ticking boxes. It requires a deep integration of sustainability controls and reporting mechanisms into the very fabric of your organization. Activating certain controls within an organization and the initial configuration of CSRD reporting be supported with a custom project planning application to keep things on track.
On the operational side, the day-to-day management of CSRD reporting becomes significantly more manageable with a tailored tool. Here’s how:
- Automated reporting: Log and track sustainability metrics, such as greenhouse gas emissions, automatically. This minimizes errors and saves time, allowing you to focus on improvement strategies.
- Customization: Fit the tool to your company's unique processes, e.g. a custom approval process whereby different people or departments need to approve certain steps before moving forward.
- Notifications and reminders: Set up automated alerts for internal and external stakeholders, ensuring timely data collection and reporting. This feature is invaluable for maintaining a continuous flow of information and ensuring no deadlines are missed. This free template can come handy here.
- Data aggregation and summarization: While the tool collects and organizes data, your CSRD expert (or a consultant from a firm specialised in CSRD, like KPMG) plays a crucial role in analyzing and summarizing this information, providing valuable insights into your sustainability performance.
Bridging the gap with expert consulting
While a no-code business application can handle much of the heavy lifting operationally, the nuanced understanding and strategic oversight of a CSRD specialist cannot be understated. An expert (external or internal) can navigate the subtleties of compliance, advise on best practices, and help interpret data for meaningful action.
By leveraging both a custom-built tool and expert consultancy, companies can achieve a level of CSRD compliance not only for regulatory fulfilment, but also for future improvements, providing a clear and transparent view of the sustainability efforts.
Kickstarting your CSRD journey
CSRD reporting may seem daunting, but with the right tools and expertise, it can become a smooth process for your company. Triggre offers the flexibility and customization necessary to meet your unique needs, while consulting services can help fill the knowledge gaps, ensuring that your sustainability reporting is both comprehensive and meaningful.
Do you have questions on this or would like to brainstorm ideas? Schedule a (free) 30-minute meeting with our partner KPMG.
