Corporate Sustainability across Europe
With the ‘Green Deal’, the EU has launched a set of measures focused on respecting human rights and protecting the environment, with the aim of making sustainable corporate governance the European standard. At the heart of these measures is the creation of transparency by regulating the supply chains and value chains of European companies.
The Corporate Sustainability Directive (CSRD)
The CSRD is a proposed directive by the European Commission aimed at enhancing corporate sustainability reporting standards within the European Union (EU).
The directive aims to address the growing demand for companies to disclose transparent and reliable information regarding their environmental, social, and governance (ESG) performance and is replacing the Non-Financial Reporting Directive (NFRD), which has been in force since 2014.
Who is affected?
All companies (including non-capital market-oriented companies) that meet two of the following three criteria:
- 250 employees
- 50 million EUR turnover
- 25 million EUR balance sheet total
As well as, publicly listed SME that meet two of the following three criteria:
- 10 employees
- 900,000 EUR turnover
- 450,000 EUR balance sheet total
This results in a reporting obligation for approx. 50,000 companies in the EU and approx. 15,000 companies in Germany.
Requirements
- Mandatory inclusion in the management report
- Digital reporting in accordance with ESEF format
- Application of the mandatory reporting standards (ESRS)
2024
Large, listed companies which previously have been affected by the NFRD must disclose ESG information in accordance with the CSRD guidelines. Conditions:
- More than 500 employees
- Listed on the stock exchange
2026
All publicly listed small and medium-sized enterprises are required to report. Condition: Two of the following three must be exceeded:
- more than 10 employees
- balance sheet total of more than 450,000 euros
- turnover of more than 900,000 euros
2024
2025
2026
2028
2025
Large companies are required to report. Condition: two of the following three must be exceeded:
- more than 250 employees on an annual average
- with a balance sheet total of more than 25 million euros
- turnover of more than 50 million euros
2028
Non-European companies are required to report. Condition:
- a net turnover of more than 150 million euros in the EU and at least one subsidiary or branch there