Use CONSUST to stay on top of the maze of ESG frameworks
You’ll find the most important ESG frameworks at a glance not only in our all-in-one ESG software, FramesCube, but also in the overview below. CONSUST empowers you to meet your ESG reporting requirements efficiently and pragmatically. Schedule a no-obligation initial consultation to learn how you can meet your ESG requirements with our software and expertise.
Overview of Key ESG Frameworks
We’ll help you gain a deep understanding of the ESG frameworks and leverage them to the fullest to drive your company’s success.
CSRD/ESRS
The Corporate Sustainability Reporting Directive (CSRD) is a directive issued by the European Union and EFRAG that significantly expands the requirements for companies to report sustainability information. It aims to improve the transparency and comparability of sustainability reports and to support the transition to a sustainable economy.
DNK
The German Sustainability Code (DNK) is a national voluntary standard developed in 2011 to help companies report transparently on their sustainability performance. It provides practical guidance for preparing sustainability reports in Germany and aims to promote transparency regarding companies’ environmental and social responsibilities.
TCFD
The Task Force on Climate-related Financial Disclosures (TCFD) was established in 2015 by the Financial Stability Board (FSB) to encourage companies to disclose climate-related financial information. The TCFD covers four areas: governance, strategy, risk management, and metrics and targets. By disclosing information in accordance with the TCFD recommendations, companies can provide greater transparency regarding their vulnerability to climate change and develop strategies to address these risks. Disclosure in accordance with the TCFD recommendations is becoming increasingly important for investors, lenders, and insurers, as it provides a sound basis for decision-making regarding future actions.
EMAS
The Eco-Management and Audit Scheme (EMAS) is a voluntary environmental management tool that helps companies and organizations continuously improve their environmental performance. It was introduced in 1993 and is open to all types of organizations, regardless of their size or industry. Organizations that register for EMAS must meet strict requirements, including the preparation of an environmental statement in which they disclose their environmental objectives, measures, and results. This environmental statement must be reviewed and validated by an independent, accredited environmental verifier. A validated environmental statement provides an organization with the benefits of improved legal certainty, increased efficiency, and cost savings through optimized resource use. Furthermore, it strengthens the confidence of customers, investors, and other stakeholders in the organization’s environmental responsibility.
EU Taxonomy
The EU Taxonomy is a classification system developed to assess economic activities based on their sustainability. It was introduced as part of the EU Action Plan on Financing Sustainable Growth to promote transparency regarding sustainable investments. It defines criteria for determining whether economic activities are environmentally sustainable. A key objective of the EU Taxonomy is to channel capital flows toward environmentally friendly and sustainable projects, thereby supporting the goals of the European Green Deal. In doing so, it provides companies and investors with a clear framework for identifying and promoting sustainable practices. The taxonomy also serves as the basis for the development of further regulatory measures, such as the Sustainable Finance Disclosure Regulation (SFDR).
CBAM
The Carbon Border Adjustment Mechanism (CBAM) is a measure proposed by the European Union that aims to prevent “carbon leakage.” Carbon leakage refers to the phenomenon in which companies relocate their production to countries with less stringent climate regulations in order to save costs, which does not reduce global CO2 emissions but merely shifts them. The CBAM will be introduced gradually and will initially cover sectors at high risk of carbon leakage.
The CBAM encourages companies worldwide to decarbonize their production processes in order to remain competitive.
NTA
The Norwegian Transparency Act requires companies to ensure transparency regarding their environmental and human rights practices. The purpose of the law is to ensure that companies fulfill their responsibility to respect human rights and protect the environment throughout their entire supply chain.
Under the law, companies must systematically identify, assess, and manage risks related to human rights and the environment in their business operations and supply chains. They are required to disclose their efforts and progress in these areas and to document the corresponding measures.
The Norwegian Transparency Act promotes greater responsibility and accountability among companies and strengthens the trust of investors, consumers, and other stakeholders in companies’ ethical and sustainable practices.
RoHS
The Restriction of Hazardous Substances Directive (RoHS) is an EU directive that was introduced in 2003 to restrict the use of hazardous substances in electrical and electronic equipment. The goal of the RoHS Directive is to protect the environment and human health by reducing exposure to hazardous substances such as lead, mercury, cadmium, hexavalent chromium, and certain flame retardants in electronic products. Companies that manufacture or distribute electrical and electronic equipment must ensure that their products do not exceed the limits for these hazardous substances specified in the directive. The RoHS Directive contributes to environmental protection and promotes the development of environmentally friendly technologies.
VSME ESRS
The VSME ESRS (Voluntary ESRS for Non-Listed Small and Medium-Sized Enterprises) is part of the European Sustainability Reporting Standards (ESRS), which were developed under the Corporate Sustainability Reporting Directive (CSRD). The VSME establishes voluntary requirements for sustainability reporting by small and medium-sized enterprises (SMEs) that are not publicly listed.
LKSG
The Supply Chain Due Diligence Act (LKSG) is a German law aimed at strengthening human rights and environmental standards in global supply chains. It requires large companies headquartered in Germany to review their supply chains for human rights and environmental violations and to take appropriate measures to prevent or mitigate them.
NFRD
The Non-Financial Reporting Directive (NFRD) is a European directive that requires companies to disclose non-financial information and is the precursor to the CSRD. It requires large public-interest companies with more than 500 employees to disclose non-financial information. This includes information on environmental, social, and labor issues, human rights, and the fight against corruption and bribery. The NFRD is implemented through national legislation in EU member states. Companies must publish this non-financial information either in their management reports or in separate sustainability reports.
GHG Protocol
The Greenhouse Gas Protocol (GHG Protocol) is the world’s leading standard for quantifying and reporting greenhouse gas emissions. It was developed in the late 1990s and provides organizations with tools and guidelines for measuring, managing, and reducing their emissions. The GHG Protocol focuses on direct emissions (Scope 1), indirect emissions from the consumption of purchased energy (Scope 2), and all other indirect emissions along the value chain (Scope 3).
The GHG Protocol serves as the basis for numerous climate initiatives and programs, as well as for various emissions trading systems, such as those used for tracking and reporting greenhouse gas emissions.
CSDDD
The Corporate Sustainability Due Diligence Directive (CSDDD) is an EU directive that aims to require companies to comply with environmental and social standards throughout their entire supply chain. The goal is to integrate human rights and environmental due diligence obligations into companies’ business practices and thereby promote responsible conduct in global supply chains. Consequently, companies are required to identify, assess, prevent, and mitigate potential negative impacts of their business activities on human rights and the environment. This encompasses both the company’s own activities and those of its direct and indirect suppliers.
EUDR
The EU Deforestation Regulation (EUDR) is a regulation adopted by the European Union that aims to combat deforestation and forest degradation worldwide. The EUDR requires companies to ensure that products and raw materials sold in the EU are not linked to deforestation or forest degradation. This applies, among other things, to products such as soy, palm oil, timber, cocoa, coffee, and cattle, as well as goods manufactured from them. There is also an obligation to respect human rights and the rights of indigenous peoples. To verify compliance, companies must submit comprehensive documentation and evidence to ensure the traceability and legality of their supply chains.
VSoTr
The Swiss Supply Chain Act, also known as the “Act on Due Diligence in the Supply Chain,” took effect in Switzerland in 2022. This law requires companies to take responsibility for human rights and environmental standards in their global supply chains. The goal is to ensure that companies systematically identify, assess, and actively address risks related to human rights violations and environmental damage.
REACH
The REACH Regulation (Registration, Evaluation, Authorization, and Restriction of Chemicals) is an EU regulation that governs the safe handling of chemical substances in the European Union. It requires companies to register chemical substances manufactured or imported into the EU and to assess their risks. The goal is to protect human health and the environment from potential hazards posed by chemicals. The regulation also covers the authorization and restriction of certain hazardous substances. REACH further promotes transparency and corporate responsibility in the handling of chemicals.
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