Navigating the complexities of Corporate Sustainability Reporting Directive (CSRD) reporting can be a daunting task for many companies. In an era marked by the increasing relevance of sustainable business practices, the CSRD stands as a vital tool in fostering transparency, accountability, and sustainable finance.
Quentin Hennaux, a sustainability expert from Greenomy, recently offered key insights on the challenges companies face with CSRD compliance, common errors, and helpful strategies.
Hennaux pointed out that a primary hurdle that companies encounter while working on CSRD reporting is understanding its integral concepts. Concepts such as the materiality assessment and standards like the ESRS form a significant part of CSRD reporting, requiring a solid comprehension for effective implementation.
The task of identifying the necessary data for reporting is another significant challenge, according to Hennaux. The CSRD’s extensive scope demands the reporting of 1,200 data points, derived from a diverse array of sources. This necessitates a complex and intricate process of data gathering, organization, and quality assurance.
Speaking on common missteps in CSRD reporting, Hennaux emphasised the importance of viewing CSRD compliance not merely as a technical exercise, but as a strategic opportunity. It’s crucial to align global strategies with ESG matters, thereby leveraging the CSRD to drive sustainable transformation.
As for companies just beginning their CSRD reporting journey, Hennaux’s advice was to start immediately. This would help them understand data requirements and establish effective systems for data collection and automation. He also advocated for streamlining reporting through automations, thereby ensuring efficiency and accuracy.
Hennaux noted the important role that the CSRD plays in promoting sustainable finance. He highlighted how the directive enables stakeholders to make more informed decisions by requiring companies to disclose reliable and comparable sustainability data through the ESRS.
On ensuring impactful sustainability efforts, Hennaux advised that companies should take the CSRD reporting and its double materiality assessment seriously. Moreover, companies should rely on science-based sustainability targets to set achievable, reliable, and impactful objectives.
Hennaux also addressed a recurring myth around CSRD reporting, which states that ESG frameworks and standards are too diverse, making ESG data unreliable and non-comparable. He refuted this notion, stating that recent legislations like the CSRD would enhance harmonization and comparability of ESG data.
In conclusion, Hennaux underscored the importance of early action and the use of an ESG reporting platform like Greenomy. With such a platform, companies can navigate the complexities of CSRD reporting efficiently and ensure compliance with ease.
Read the full report here.
Keep up with all the latest FinTech news here
Copyright © 2023 FinTech Global