CSRD is resetting the ESG value-creation agenda in CEE

All companies listed on EU-regulated markets and large companies not listed — potentially including non EU-based multinational companies. CSRD is expected to impact approximately 50,000 companies globally — including 10,000 companies headquartered outside of the EU and include those in the following categories: 

• Companies with securities listed on an EU-regulated market (with some exceptions, such as ‘micro-undertakings’).

• Unlisted EU companies of a certain size (including EU subsidiaries of companies headquartered outside the EU, which may be covered by the parent companies’ consolidated reporting).

• Unlisted EU parent companies with total holdings of a certain size. ^[1]

_{[1] Companies must comply with CSRD if they exceed two of the following three size thresholds: total assets of €25 million, revenue of €50 million and an average of 250 employees during the fiscal year on two consecutive balance-sheet dates..}

Companies must assess the materiality of sustainability topics across their value chains and consider which of more than 1,000 data points to disclose. Other disclosures will consist of qualitative information, such as how the corporate strategy accounts for sustainability opportunities and risks. All the information requires independent assurance (beginning at the limited level).

Chief Executive Officers, Chief Financial Officers, Chief Security Officers and Chief Information Officers — indeed entire management teams — will have new day-to-day CSRD tasks. Supervisory boards and audit committees must oversee a company’s sustainability reporting.

Companies now subject to the EU’s Non-Financial Reporting Directive must follow the Directive for fiscal years starting on or after January 1 2024 (filing reports in FY2025). Other listed companies, along with unlisted companies meeting certain size thresholds, will get more time.