CSRD - Corporate Sustainability Reporting Directive

The EU's Corporate Sustainability Reporting Directive (CSRD) marks a profound change in the way companies disclose their sustainability practices. This directive, which comes into force in 2023, forces companies to be transparent about their environmental, social and governance practices (ESG). This will bring corporate responsibility more into focus. The CSRD follows the CSR Directive of 2014, which for the first time obliged larger companies in the EU to report on non-financial information. Find out here what needs to be taken into account and how the CSRD directive can help you to reposition yourself in the market environment and strengthen your competitiveness. Since 1999 the PATRIZIA Foundation is your experienced partner in matters of Corporate Social Responsibility (CSR) and sustainability.

Discussion CSR Partnership with Nikolaus Moser

What is CSRD?

The Corporate Sustainability Reporting Directive (CSRD) is an EU directive introduced in 2023 that requires comprehensive disclosure of companies' sustainability strategies and results. Companies must publish detailed information on environmental concerns, social aspects, labour conditions, human rights and ethical business practices. The aim of the CSRD is to increase the transparency and comparability of sustainability reports in order to promote responsible corporate governance in a competitive environment.

What's new compared to the CSR-Directive?

The CSR Directive of 2014 only required companies with more than 500 employees to publish non-financial information. The CSRD Directive, on the other hand, extends the scope of application to all listed companies, including many SMEs. The CSRD also sets out more detailed reporting requirements, which must be confirmed by an external audit.

While the CSR Directive only required general disclosure, the CSRD requires more precise and standardised reporting, which includes greater integration into the management report and digital submission.

The Supply Chain Act and the CSRD

One aspect that is often mentioned in connection with CSRD is the Supply Chain Act (officially the Supply Chain Duty of Care Act), which came into force in 2023. It obliges companies to take responsibility for compliance with human rights and environmental standards along their entire supply chain. The CSRD builds on similar principles by obliging companies to also create transparency in their sustainability reports about compliance with due diligence obligations in the supply chain. Companies must therefore not only disclose their internal practices, but also demonstrate how they manage risks in their supply chain.

CSRD-Implementation

The implementation of the CSRD entails a number of requirements that companies must fulfil in order to be compliant.

Who is required to report under the CSRD?

Since January 2023, the CSRD has affected all capital market-oriented companies and certain organisations of public interest within the EU. These include, for example, banks, insurance companies and other financial service providers, but also companies that are relevant to security of supply, such as energy suppliers. It thus expands the previously applicable CSR Directive and sets a new framework for sustainability reporting. Official estimates assume that 50,000 medium-sized businesses will fall under the CSRD. Companies that fulfil at least two of the following criteria are affected:



> 250 employees



> 40 Mio. turnover



> 20 million

total balance sheet

Many companies face the challenge of not yet having developed a comprehensive ESG strategy. However, CSRD also offers opportunities to position themselves as responsible market participants.

What requirements must be observed for the CSRD?

Extended reporting requirements: Companies must submit detailed reports on their ESG practices. This includes not only the disclosure of targets and measures, but also concrete results and progress in the areas of environment, social affairs and governance.
External audit: All reports must be audited by independent third parties to ensure the accuracy and reliability of the information. This requires close co-operation with audit firms and thorough preparation of the reporting.
Integrated approach: Sustainability information must be integrated into the management report. Companies must ensure that their ESG strategy is firmly embedded in the overall strategy and includes all relevant business functions.
Digital submission: Companies are required to submit their reports in a digital format, which requires an additional level of preparation and technical customisation.

What opportunities arise from CSRD?

The CSRD therefore requires the holistic integration of sustainability practices into corporate management. These requirements should not be seen as a mere obligation, but as a strategic opportunity to strengthen the company's market position. The CSRD therefore also offers completely new scope for organisation in the areas of communication and marketing - an opportunity.

PATRIZIA Foundation – Your CSRD-Expert

Many companies have already made progress in their E (Environmental) within ESG practices. But the S (social) is often neglected - and this is precisely where the PATRIZIA Foundation comes in. As experts in the field of social responsibility and corporate volunteering, we offer you customised solutions to strengthen your company's social commitment.

Popular solutions include membership of our network, the Impact Circle, and sponsorships for projects. With our ex-post evaluation developed together with the Vienna University of Economics and Business, we can comprehensively present your social investment in our projects.

CSRD - the key factor in the war for talents

The S in ESG can not only have a significant impact on a company's reputation, but is also a decisive factor in the war for talent. A strong social commitment improves employer branding, supports HR issues and helps to attract and retain talented employees. We support you in concretising your social responsibility and translating it into measurable results.