industry
Finance
Location
European Union
Status
In effect
Overview
The Corporate Sustainability Reporting Directive (CSRD) provides a framework for companies to report on environmental, social, and governance (ESG) metrics material to their organizations. Its goal is to make reporting more consistent, transparent, and verifiable. This rule supersedes a previous European Union (EU) reporting rule, the Non-financial Reporting Directive (NFRD). The CSRD raises the number of companies affected by mandatory ESG reporting from 11,000 to nearly 50,000 EU companies and at least 10,000 foreign enterprises with EU operations. Based on the EU Sustainability Reporting Standard (ESRS), climate reporting requirements are grounded by the principle of “double-materiality.” This means companies must disclose the impacts of climate change on their company, as well as the impacts they have on the climate and people across their entire value chain.
Requirements
Disclose scope 1, scope 2, and scope 3 emissions
Report climate and sustainability risks associated with business model and strategies
Affected Companies
Revenue thresholds
Required for non-EU companies if they generate over EUR 150 million on the EU market
Company size
Publicly listed companies
Company Type
Private
Geography
EU and non-EU companies with EU operations
industry
Finance
Status:
timeline for compliance
The first reporting deadline is January 2025, based on 2024 calendar year data. Disclosure standards vary according to the size and type of company. Effective dates will roll out on a staggered schedule, with initial disclosures based on the previous calendar year.
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