The Corporate Sustainability Reporting Directive (CSRD) is transforming how companies in the EU disclose sustainability information. All affected organisations must report on environmental, social, and governance (ESG) matters, ensuring transparency for investors, regulators, and other stakeholders.

The European Sustainability Reporting Standards (ESRS), developed by EFRAG, define the detailed reporting requirements, including which topics to cover, relevant KPIs, and disclosure formats.

Key points:

• Phased reporting: Obligations will roll out between 2025 and 2029, depending on company size and whether the organisation is classified as a public-interest entity.

• Scope of reporting: Includes environmental impact, social practices, governance, risk management, and forward-looking strategies.

• Purpose: To increase transparency, accountability, and comparability of sustainability information across industries.

• Integration: Reports must reflect both ESG performance and the business implications of sustainability initiatives.
  
  

Understanding these requirements helps companies prepare early, align processes, and communicate effectively with stakeholders — turning compliance into a strategic advantage.

The EU Taxonomy Regulation provides a comprehensive framework for defining which economic activities are environmentally sustainable. Companies are expected to assess their operations against strict technical screening criteria and report on their contribution to climate and environmental objectives.

Beyond environmental compliance, the regulation also requires companies to disclose key financial metrics related to sustainable activities, including:

• CapEx (Capital Expenditure): investments in sustainable assets or projects.

• OpEx (Operational Expenditure): ongoing operational spending aligned with sustainability objectives.

• Turnover: revenue generated from environmentally sustainable activities.

Greenhouse gas (GHG) reporting is increasingly required under CSRD and international standards, reflecting the growing emphasis on climate transparency for regulators, investors, and other stakeholders.

Companies need to measure and report emissions across three scopes:

• Scope 1: Direct emissions from company-owned or controlled sources.

• Scope 2: Indirect emissions from the generation of purchased electricity, heat, or steam.

• Scope 3: Other indirect emissions along the value chain, including suppliers, transportation, and product use.
  
  

By understanding emissions across all scopes, organisations can take informed action to reduce climate impact while enhancing transparency and stakeholder confidence.

The Double Materiality Principle requires organisations to consider both sides of the sustainability equation:

• Impact materiality (IM) — how the company’s operations affect the environment, society, and stakeholders.

• Financial materiality (FM) — how environmental and social issues influence the company’s performance, risks, and opportunities.
  
  

Stakeholder assessment complements this by identifying all individuals, groups, or organisations that are affected by or can affect a company’s operations, decisions, and sustainability outcomes. In ESG and sustainability work, this ensures that companies consider the right voices, concerns, and expectations when making strategic and reporting decisions, strengthening both transparency and informed decision-making.

Organisations today face a growing range of environmental, social, and governance (ESG) risks — from regulatory compliance and legal obligations to reputational and operational challenges. Effective ESG risk management ensures that companies not only identify, assess, and prioritise risks, but also integrate mitigation strategies directly into business processes.

By proactively managing ESG risks, organisations can enhance resilience, safeguard their reputation, and make informed strategic decisions. This approach transforms compliance obligations into practical actions that support long-term business value and stakeholder confidence.

The Corporate Sustainability Due Diligence Directive (CSDDD) requires companies to identify, prevent, and mitigate adverse human rights and environmental impacts across their operations and supply chains. While the CSRD focuses on collecting and disclosing ESG data, the CSDDD emphasizes turning that knowledge into action — integrating insights from reporting into concrete policies, processes, and decision-making.

By aligning operations with CSDDD requirements, companies can reduce regulatory and reputational risks, strengthen stakeholder trust, and embed sustainability into the core of business strategy, transforming compliance into tangible long-term value.

Companies are increasingly expected to embed sustainability and climate considerations into strategic decision-making. This goes beyond simply reporting data — it involves identifying risks and opportunities, designing actionable transition and decarbonisation plans, and aligning initiatives with both business objectives and stakeholder expectations.

By integrating sustainability into core strategy, organisations can enhance resilience, drive long-term value, and strengthen stakeholder trust, ensuring that climate and ESG efforts translate into measurable business outcomes rather than remaining abstract commitments.

Effective ESG and sustainability initiatives only create real impact when stakeholders — from investors and customers to employees and partners — clearly understand and trust your company’s actions. Without transparent and consistent communication, even the most ambitious sustainability strategies can be overlooked, misunderstood, or undervalued.

Marketing and communications are therefore essential tools for translating strategy into tangible perception and engagement. By aligning messaging with actual ESG performance, companies can demonstrate accountability, showcase achievements, and build credibility, ensuring that sustainability efforts strengthen both reputation and business value.

Clear, consistent communication also helps organisations avoid the pitfalls of greenwashing, supports stakeholder confidence, and ensures that sustainability initiatives are perceived as strategic, credible, and integral to the company’s mission.