CSRD Sample Reports: Learning from Pioneers
As early as the 2024 fiscal year, large companies will be required to prepare a sustainability report in accordance with the CSRD. However, while there are detailed ESRS standards that companies must follow when reporting, examples of such reports have long been lacking. Some pioneering companies, however, have already voluntarily published an ESRS-aligned report for the 2023 fiscal year. With the CSRD, companies will face reporting requirements on a scale never seen before. The CSRD sample reports can therefore serve as a useful guide. Read here to find out what you can learn from the sample reports.
What obligations does the CSRD Directive entail?
The EU’s Corporate Sustainability Reporting Directive (CSRD) requires companies to provide more comprehensive and standardized reporting on their sustainability performance. It extends the reporting requirements of its predecessor, the NFRD, to a wider range of companies and mandates detailed information on environmental, social, and governance factors (ESG). The goal is to increase transparency and enable investors, consumers, and other stakeholders to better understand companies’ sustainability practices. The CSRD will take effect starting with the 2024 fiscal year and will be phased in for larger companies and publicly traded SMEs. Large companies will be required to report starting with the 2025 fiscal year. The CSRD is based on a materiality analysis. This analysis is intended to provide insight into which sustainability issues are relevant to a company, what risks and opportunities are associated with them, and what influence the company has on the issue. Reporting is conducted in accordance with the ESRS standard, which was created specifically for this purpose.
CSRD Sample Reports
Although the ESRS standard is based on existing voluntary reporting standards such as GRI, it goes beyond them. As a result, there has been a lack of concrete examples of its application to date. However, there are now some pioneering companies that are voluntarily applying the sustainability standards. Lessons can be learned from these approaches. However, it should be noted that the reports analyzed do not fully meet the ESRS requirements, and certain requirements have been omitted so far. Mandatory reporting starting in 2025 will therefore likely be somewhat more detailed. The analyzed reports can be found here.
Best Practices from the Sample Reports
- Number of material topics
On average, seven of the ten topics listed in the ESRS are classified as material. Therefore, only these material topics are addressed in the reports. However, it can be assumed that companies that report voluntarily are ambitious and are likely to address more material topics than is required. Some topics, such as “E1—Climate Change” or “S1—Own Employees,” are likely to be relevant to nearly all companies. - Breakdown of Impacts, Risks, and Opportunities (IROs)
The ESRS requires that, for each material topic, the company identify and assess risks and opportunities affecting the company, as well as impacts arising from the company’s activities. According to the ESRS, these IROs should be disclosed in a transparent and easily recognizable manner. This is best achieved by providing an IRO overview in the form of a list or table at the beginning of each topic chapter. Simply addressing the topics without labeling them in the running text makes it difficult to maintain an overview. - Risk of Confusion: IROs and Measures
In some of the sample reports, measures are mistakenly interpreted as IROs. For example, a measure such as occupational safety training is not a positive impact, but rather a measure designed to mitigate a negative impact. - Length
On average, the sample reports are 88 pages long. However, there are significant variations. The longest report is 211 pages long. As a rule of thumb, the sustainability report is typically about the same length as the rest of the annual report.
Structure Sustainability reports must be organized into four sections: General Information, Environmental Information, Social Information, and Governance Information. Beyond that, there is considerable flexibility in the structure, even though the ESRS paragraphs provide guidance. For the sake of clarity and comparability, companies should follow this ESRS structure. However, company-specific adjustments should be made where appropriate. Most companies use a “PAT structure” for the individual topic chapters. This stands for Policies, Actions, and Targets.- Visualization
Until now, voluntary sustainability reports have been characterized by a great deal of creative freedom and have often resembled marketing brochures. Now, however, the report is included in the management discussion and analysis section of the annual report and should be adapted accordingly. Images that do not add meaningful information can be omitted. Of course, images, diagrams, or tables can still be used selectively as helpful visual aids.
Findings from the Analysis of Additional CSRD Sample Reports
In another study conducted by the University of Cologne, the reports of 45 additional companies were examined. The study reveals, for example, that so far only about half of the companies use a four-step materiality analysis process. This approach is recommended, for example, in an Implementation Guide published by EFRAG (European Financial Reporting Advisory Group). The presentation of the results of a materiality analysis, which forms the basis of the sustainability report, is also analyzed. This is not specified in the ESRS. Most of the companies examined used a matrix or table. To present the material topics in a way that is both clear and sufficiently detailed, a combination of a matrix and a table, for example, is suitable.
Making the Most of Examples with CONSUST
Preparing a comprehensive sustainability report in accordance with the CSRD involves a great deal of work. Referring to existing examples and templates can simplify the process. To help you get started, we’ve already integrated best practices and examples into our Framescube CSRD / ESRS software. At CONSUST, we’re happy to advise you on implementing the CSRD in your company and guide you through the reporting process easily and efficiently with our software. Conduct a dual materiality analysis, collect data from all your subsidiaries, and use our AI-powered reporting tools to create your CSRD-compliant report. Contact us for a no-obligation consultation on simplifying your CSRD process.
