Legislating Sustainability: The CSRD and Why it Matters

Essentially companies will need to report on information necessary to ‘understand the company’s impacts on sustainability matters and how they affect the company’s development, performance and position’. This includes aspects of business strategy, governance of ESG issues, reporting on material environmental and social factors, including those within the business supply chain.
However, the standards and topics that companies must report on need to be revisited and enhanced if meaningful action is to take place. Although double materiality is written into the new reporting standards within the CSRD, context-based performance is not.
If you want to show a reader how environmentally responsible you are, you can only do it with reference to ecological limits. You can’t say ‘we are 5% better than last year’ as if that’s sufficient information. A reader can’t look at 5% better and know if that’s good enough.