Introduction to CSRD and ESRS

The Corporate Sustainability Reporting Directive (CSRD) and the European Sustainability Reporting Standards (ESRS) are regulatory frameworks established by the European Union to enhance and standardize corporate sustainability reporting.

• CSRD: The CSRD aims to improve the quality, consistency, and comparability of sustainability information disclosed by companies. It expands the scope of the previous Non-Financial Reporting Directive (NFRD) by including more companies, including listed SMEs, and requiring detailed sustainability reports. The directive mandates that companies report on how sustainability issues affect their performance and how their operations impact people and the environment. It also requires the assurance of sustainability information and digital tagging to facilitate data accessibility and comparability.
  

• ESRS: The ESRS are a set of detailed reporting standards developed to support the CSRD. These standards provide specific guidelines and requirements for companies to follow when preparing their sustainability reports. The ESRS cover a wide range of sustainability topics, including environmental protection, social responsibility, and governance practices. They are designed to ensure that the sustainability information reported is relevant, reliable, and comparable across companies and sectors.

Together, the CSRD and ESRS aim to enhance transparency, accountability, and stakeholder trust by providing a robust framework for sustainability reporting, thereby supporting the EU’s broader sustainability and climate goals. This further increases the importance for companies in the region to ensure rebust processes for quality assuring ESG data and calculations.