Corporate Sustainability Reporting Directive (CSRD)

By the European Commission
January 2024

The European Union’s (EU) Corporate Sustainability Reporting Directive (CSRD) requires large companies and listed companies to disclose information on social and environmental risks they face, as well as the impacts of their activities on people and the environment. This directive will modernise and strengthen the reporting rules, expanding the number of companies required to report on sustainability, and creating a culture of transparency. Companies will have to apply the new rules for the first time in the financial year 2024, for reports published in 2025. Approved in August 2023, companies subject to the CSRD will have to report according to European Sustainability Reporting Standards (ESRS), and they will be audited. The rules introduced by the Non-Financial Reporting Directive remain in force until companies have to apply the new rules of the CSRD, and apply to large public-interest companies with more than 500 employees.

The proposal is part of the EU’s broader efforts to achieve a sustainable and inclusive economic recovery and transition to a more sustainable and resilient economy. By improving the consistency and reliability of sustainability reporting, the new directive aims to help investors, civil society organisations, consumers and other stakeholders make informed decisions and hold companies accountable for their Environmental, social, and corporate governance (ESG) performance.

It will apply to all large companies in the EU, both public and private, around 50,000 businesses.  It’s been estimated that it will impact some 3,000 US companies.

The directive strengthens reporting on Scope 3 emissions categories that include business travel.

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