Which CSRD standards are mandatory and when? As of June 2023

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| July 7, 2023

🕓 Reading time 6 minutes

Table of contents

1. Overview of the changes to the CSRD Standards in June 2023

2. Changes to the materiality analysis

3. Relief in the first reporting year

4. Conversion of mandatory to voluntary information

5. What happens next?

1. Overview of the changes to the CSRD Standards in June 2023

On 9 June 2023, the European Commission adopted the draft delegated act on the European Sustainability Reporting Standards (ESRS). published as of the Corporate Sustainability Reporting Directive (CSRD) This draft contains some Improvements compared to the previous version the reporting standards for non-financial reporting.

The current draft status can be found here.

In November last year, the drafts of the CSRD standards, the so-called European Sustainability Reporting Standards (ESRS)., was submitted by EFRAG to the EU Commission. After extensive consultation with various stakeholders, some significant changes to the ESRS were made by June 2023.

The group of those affected remains unchanged

The affected group Sustainability reporting remains untouched. Furthermore, in Germany, approximately 15,000 new companies (compared to the NFRD) must report their ESG reporting for the Corporate Sustainability Reporting Directive (see also our blog post on the CSRD and the impact criteria). Reporting according to EU taxonomy is also not affected by these changes.

Aim of the changes

The main objective of the changes in the European Sustainability Reporting Standards (ESRS). from June 2023 was to make companies that are required to report to relieve and ensure that the reporting standards appropriate are.

Which principles are changing?

The Materiality analysis becomes even more important with the new changes, as almost all standards now depend on it.

The specific changes also affect Facilitation of first-time application affected companies and the Conversion of some mandatory information into voluntary information. In addition, there is greater flexibility with some mandatory data sets in ESRS 1.

Impact on the preparation phase in the company

These significant and recent changes to the CSRD standards have a direct impact on your company's ongoing preparation phase. It is therefore important that you keep the following points in mind:

2. Changes to the materiality analysis

Materiality analysis as a prerequisite for the CSRD standards

The materiality analysis is now a prerequisite for all standards, except the ESRS 2.

The materiality reservation therefore applies for all specific ESRS (Environmental, Social and Governance ESRS), all reporting requirements within the specific ESRS and all data points included in those reporting requirements.

Standards previously treated as mandatory disclosures, such as ESRS E1, are now subject to materiality testing. This then establishes for each company individually which standards and which reporting requirements and data points must be reported.

3. Relief in the first reporting year

New Transitional provisions make entry easier in the first reporting year. Some of these are linked to company size.

In the first reporting year, the following relief measures apply to companies with up to 750 employees:

On the Scope 3 Greenhouse gas emissions can be waived in the first reporting year. Scope 1 (direct company emissions) and Scope 2 (indirect energy-related emissions) are reported. From the second reporting year, the Scope 3 Emissions, i.e. upstream and downstream emissions from the supply chain, are mandatory.

All ESRS S1 requirements can be waived in the first reporting year.

For all companies in the first reporting year

There are simplifications in the disclosure of, among other things, the potential financial effects of environmental impacts, risks and opportunities (pollution, water, biodiversity) – but not climate-related effects.

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4. Conversion of mandatory to voluntary information

The new draft provides the voluntary option to explain why certain sustainability topics were classified as immaterial.

Now the Transitional Plan for Biodiversity and Ecosystems (ESRS E4) voluntary, which specifies that the business model and strategy are consistent with planetary boundaries, biosphere integrity, land system change and the relevant objectives of the EU 2030 Biodiversity Strategy.

In addition, a variety of Metrics on non-employee employees (ESRS S1) voluntarily.

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ACTING NOW IS WORTH IT

When it comes to sustainability or ecological viability, climate change and human influence on it are central, as in hardly any other area can environmental impacts be measured and documented so well with figures. The indicator here is anthropogenic emissions, i.e., greenhouse gas emissions caused by humans that contribute to global warming.

What does this mean in the context of sustainable business? Every company should keep its greenhouse gas emissions – which are unavoidable in the provision of business services – as low as possible. Sustainable business cannot be achieved at the push of a button, but a continuous optimization process based on ecological indicators is the crucial approach.

By recording the greenhouse gas emissions generated by your company, product, or service, you can identify potential for emission reduction. This enables you to optimize your processes and also save costs. You communicate to your customers and suppliers that you take responsibility for the emissions for which you are responsible. This allows you to build trust and adapt to the requirements of your business partners.

Acting now is worthwhile

Knowing your emissions will prepare you for predictable, more stringent regulatory requirements, such as increasing greenhouse gas emissions taxes or the mandatory implementation of investment-intensive measures. Incorporating this component into your corporate risk management is essential in the long term.

Due to the ongoing social demand for Climate protection, even the European Central Bank under Christine Lagarde has now taken the inevitable course of giving capital preferential treatment to companies that can demonstrably Climate protection The same trend is evident in the capital flow of large asset managers, such as BlackRock. Their chairman, Larry Fink, wrote in a letter to his CEOs that companies that do not address environmental issues seriously and transparently are no longer viable and will therefore no longer be invested in.

Climate protection Therefore, operating your company professionally and verifiably is inevitable in the near future. If your company is among the first to address this situation, you will establish a pioneering effect that prepares you for the foreseeable legal requirements, results in lower capital costs in the long term, and guarantees market advantages!

ACTING NOW IS WORTH IT

When it comes to sustainability or ecological viability, climate change and human influence on it are central, as in hardly any other area can environmental impacts be measured and documented so well with figures. The indicator here is anthropogenic emissions, i.e., greenhouse gas emissions caused by humans that contribute to global warming.

What does this mean in the context of sustainable business? Every company should keep its greenhouse gas emissions – which are unavoidable in the provision of business services – as low as possible. Sustainable business cannot be achieved at the push of a button, but a continuous optimization process based on ecological indicators is the crucial approach.

By recording the greenhouse gas emissions generated by your company, product, or service, you can identify potential for emission reduction. This enables you to optimize your processes and also save costs. You communicate to your customers and suppliers that you take responsibility for the emissions for which you are responsible. This allows you to build trust and adapt to the requirements of your business partners.

Acting now is worthwhile

Knowing your emissions will prepare you for predictable, more stringent regulatory requirements, such as increasing greenhouse gas emissions taxes or the mandatory implementation of investment-intensive measures. Incorporating this component into your corporate risk management is essential in the long term.

Due to the ongoing social demand for Climate protection, even the European Central Bank under Christine Lagarde has now taken the inevitable course of giving capital preferential treatment to companies that can demonstrably Climate protection The same trend is evident in the capital flow of large asset managers, such as BlackRock. Their chairman, Larry Fink, wrote in a letter to his CEOs that companies that do not address environmental issues seriously and transparently are no longer viable and will therefore no longer be invested in.

Climate protection Therefore, operating your company professionally and verifiably is inevitable in the near future. If your company is among the first to address this situation, you will establish a pioneering effect that prepares you for the foreseeable legal requirements, results in lower capital costs in the long term, and guarantees market advantages!

ACTING NOW IS WORTH IT

When it comes to sustainability or ecological viability, climate change and human influence on it are central, as in hardly any other area can environmental impacts be measured and documented so well with figures. The indicator here is anthropogenic emissions, i.e., greenhouse gas emissions caused by humans that contribute to global warming.

What does this mean in the context of sustainable business? Every company should keep its greenhouse gas emissions – which are unavoidable in the provision of business services – as low as possible. Sustainable business cannot be achieved at the push of a button, but a continuous optimization process based on ecological indicators is the crucial approach.

By recording the greenhouse gas emissions generated by your company, product, or service, you can identify potential for emission reduction. This enables you to optimize your processes and also save costs. You communicate to your customers and suppliers that you take responsibility for the emissions for which you are responsible. This allows you to build trust and adapt to the requirements of your business partners.

Acting now is worthwhile

Knowing your emissions will prepare you for predictable, more stringent regulatory requirements, such as increasing greenhouse gas emissions taxes or the mandatory implementation of investment-intensive measures. Incorporating this component into your corporate risk management is essential in the long term.

Due to the ongoing social demand for Climate protection, even the European Central Bank under Christine Lagarde has now taken the inevitable course of giving capital preferential treatment to companies that can demonstrably Climate protection The same trend is evident in the capital flow of large asset managers, such as BlackRock. Their chairman, Larry Fink, wrote in a letter to his CEOs that companies that do not address environmental issues seriously and transparently are no longer viable and will therefore no longer be invested in.

Climate protection Therefore, operating your company professionally and verifiably is inevitable in the near future. If your company is among the first to address this situation, you will establish a pioneering effect that prepares you for the foreseeable legal requirements, results in lower capital costs in the long term, and guarantees market advantages!

ACTING NOW IS WORTH IT

When it comes to sustainability or ecological viability, climate change and human influence on it are central, as in hardly any other area can environmental impacts be measured and documented so well with figures. The indicator here is anthropogenic emissions, i.e., greenhouse gas emissions caused by humans that contribute to global warming.

What does this mean in the context of sustainable business? Every company should keep its greenhouse gas emissions – which are unavoidable in the provision of business services – as low as possible. Sustainable business cannot be achieved at the push of a button, but a continuous optimization process based on ecological indicators is the crucial approach.

By recording the greenhouse gas emissions generated by your company, product, or service, you can identify potential for emission reduction. This enables you to optimize your processes and also save costs. You communicate to your customers and suppliers that you take responsibility for the emissions for which you are responsible. This allows you to build trust and adapt to the requirements of your business partners.

Acting now is worthwhile

Knowing your emissions will prepare you for predictable, more stringent regulatory requirements, such as increasing greenhouse gas emissions taxes or the mandatory implementation of investment-intensive measures. Incorporating this component into your corporate risk management is essential in the long term.

Due to the ongoing social demand for Climate protection, even the European Central Bank under Christine Lagarde has now taken the inevitable course of giving capital preferential treatment to companies that can demonstrably Climate protection The same trend is evident in the capital flow of large asset managers, such as BlackRock. Their chairman, Larry Fink, wrote in a letter to his CEOs that companies that do not address environmental issues seriously and transparently are no longer viable and will therefore no longer be invested in.

Climate protection Therefore, operating your company professionally and verifiably is inevitable in the near future. If your company is among the first to address this situation, you will establish a pioneering effect that prepares you for the foreseeable legal requirements, results in lower capital costs in the long term, and guarantees market advantages!

ACTING NOW IS WORTH IT

When it comes to sustainability or ecological viability, climate change and human influence on it are central, as in hardly any other area can environmental impacts be measured and documented so well with figures. The indicator here is anthropogenic emissions, i.e., greenhouse gas emissions caused by humans that contribute to global warming.

What does this mean in the context of sustainable business? Every company should keep its greenhouse gas emissions – which are unavoidable in the provision of business services – as low as possible. Sustainable business cannot be achieved at the push of a button, but a continuous optimization process based on ecological indicators is the crucial approach.

By recording the greenhouse gas emissions generated by your company, product, or service, you can identify potential for emission reduction. This enables you to optimize your processes and also save costs. You communicate to your customers and suppliers that you take responsibility for the emissions for which you are responsible. This allows you to build trust and adapt to the requirements of your business partners.

Acting now is worthwhile

Knowing your emissions will prepare you for predictable, more stringent regulatory requirements, such as increasing greenhouse gas emissions taxes or the mandatory implementation of investment-intensive measures. Incorporating this component into your corporate risk management is essential in the long term.

Due to the ongoing social demand for Climate protection, even the European Central Bank under Christine Lagarde has now taken the inevitable course of giving capital preferential treatment to companies that can demonstrably Climate protection The same trend is evident in the capital flow of large asset managers, such as BlackRock. Their chairman, Larry Fink, wrote in a letter to his CEOs that companies that do not address environmental issues seriously and transparently are no longer viable and will therefore no longer be invested in.

Climate protection Therefore, operating your company professionally and verifiably is inevitable in the near future. If your company is among the first to address this situation, you will establish a pioneering effect that prepares you for the foreseeable legal requirements, results in lower capital costs in the long term, and guarantees market advantages!

ACTING NOW IS WORTH IT

When it comes to sustainability or ecological viability, climate change and human influence on it are central, as in hardly any other area can environmental impacts be measured and documented so well with figures. The indicator here is anthropogenic emissions, i.e., greenhouse gas emissions caused by humans that contribute to global warming.

What does this mean in the context of sustainable business? Every company should keep its greenhouse gas emissions – which are unavoidable in the provision of business services – as low as possible. Sustainable business cannot be achieved at the push of a button, but a continuous optimization process based on ecological indicators is the crucial approach.

By recording the greenhouse gas emissions generated by your company, product, or service, you can identify potential for emission reduction. This enables you to optimize your processes and also save costs. You communicate to your customers and suppliers that you take responsibility for the emissions for which you are responsible. This allows you to build trust and adapt to the requirements of your business partners.

Acting now is worthwhile

Knowing your emissions will prepare you for predictable, more stringent regulatory requirements, such as increasing greenhouse gas emissions taxes or the mandatory implementation of investment-intensive measures. Incorporating this component into your corporate risk management is essential in the long term.

Due to the ongoing social demand for Climate protection, even the European Central Bank under Christine Lagarde has now taken the inevitable course of giving capital preferential treatment to companies that can demonstrably Climate protection The same trend is evident in the capital flow of large asset managers, such as BlackRock. Their chairman, Larry Fink, wrote in a letter to his CEOs that companies that do not address environmental issues seriously and transparently are no longer viable and will therefore no longer be invested in.

Climate protection Therefore, operating your company professionally and verifiably is inevitable in the near future. If your company is among the first to address this situation, you will establish a pioneering effect that prepares you for the foreseeable legal requirements, results in lower capital costs in the long term, and guarantees market advantages!

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CO₂ accounting for companies and products

Regulation, CSRD and GHG standards

Climate strategy and reduction targets

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