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May 06, 2024

CSRD will shape reporting by companies outside its scope, survey finds

Most companies will align with the EU’s landmark ESG regulation regardless of whether it applies to them, according to poll

New research shows that the majority – 81 percent – of companies not subject to the EU’s Corporate Sustainability Reporting Directive (CSRD) intend to meet its disclosure requirements in some shape or form.

The survey of more than 2,000 people working in corporate reporting, sustainability or related functions carried out by Workiva also finds that respondents almost unanimously consider meeting the demands of mandates such as the CSRD as the most pressing challenge ahead of them.

Those polled by Workiva say the volume of different requirements they must contend with rank as their top compliance concern; 83 percent also agree that collecting accurate data to fulfil the double-materiality requirements of the CSRD is going to pose a significant challenge to their organizations.

Nonetheless, almost everyone surveyed agrees it is worth the admin headache: 88 percent of respondents say integrated reporting will have a positive, long-term impact on their organization’s value creation, with the same proportion agreeing that obtaining assurance over ESG data increases the likelihood a company will achieve its goals.

More than four in five (81 percent) of those Workiva polled agree that generative AI will make it easier for them to carry out their reporting role in the next five years. Projects like Alex Annaev’s CSRD Chat tool, which has been trained on reams of data from EU advisory groups and hours of official guidance videos, are already showing how this is possible.

Replacing the Non-Financial Reporting Directive, the CSRD came into force in January 2023 and has applied since the start of this year. For entities reporting in the EU, the implications have been widespread and well cataloged: among other things, there is an emphasis on double-materiality reporting.

For more expert analysis on the topic, I’d recommend this comprehensive feature written by my colleague Noemi Distefano: CSRD & ESRS compliance: Challenges, strategies and global impact.