CSRD (Corporate Sustainability Reporting Directive)

The Corporate Sustainability Reporting Directive (CSRD) is a draft law of the European Commission that aims to improve the consistency and comparability of sustainability reports of companies within the EU. It amends the existing Non-Financial Reporting Directive (NFRD) and extends its scope to a wider range of companies.

The main features of the CSRD are

Extended scope: The Directive applies to all large companies and all companies listed on regulated markets, including small and medium-sized enterprises (SMEs), although the latter may have some reporting exemptions.
Detailed reporting obligations: Companies are required to report on sustainability issues, including environmental, social and governance (ESG) factors. This includes information on their business model, sustainability risks and impacts on sustainability issues.
Alignment with the EU taxonomy: The CSRD requires companies to disclose how their activities comply with the EU taxonomy in order to promote transparency in the area of sustainable finance.
Audit requirement: Companies must have a third-party audit of their sustainability reports, which increases the reliability of the information provided.

The CSRD is part of the EU's wider commitment to promoting a sustainable economy and ensuring that investors have access to relevant information on sustainability risks and opportunities.