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On January 5, 2023 the EU Corporate Sustainability Reporting Directive went into force. The directive broadens the scope of companies report on sustainability issues, adds to the amount of information that needs to be reported, and even requires external assurance, reports Elena Sychenko, Adjunct Professor at the Department of Management at the University of Bologna and currently a Fulbright Scholar at the Wharton School of Business. The directive now covers all listed companies with the exception of micro enterprises. Also falling under it are non-EU companies that have a significant presence in the EU. The reporting requirements, which are still being fully developed, closely follow the Global Reporting Initiative (GRI) standards and focus on ESG explicitly, with several areas of reporting under E, S, and G. These include: E: climate change, pollution, water, biodiversity S: the organization’s own workforce, the workforce in the value chain, affected communities, consumers and end users G: business conduct in general Compliance teams will need to ensure that the reporting is accurate. One area to watch out for, she notes, is vagueness. A company may choose to provide overly vague information that could be misleading. Listen in to learn more about the directive and the risks involved. https://lnkd.in/gKRRviV3

WHAT IS ESG USED FOR? ESG stands for Environmental, Social, and Governance. It is a framework used to evaluate how a company or organization performs in three key areas: Environmental: This refers to how a company manages its impact on the environment, including issues such as climate change, resource depletion, waste management, pollution, and conservation of biodiversity. Social: This aspect covers how a company manages relationships with its employees, suppliers, customers, and the communities in which it operates. It includes issues like labor practices, human rights, workplace diversity and inclusion, and community engagement . Governance: This involves the internal systems, controls, and processes that govern a company’s decision-making. It includes issues like board diversity, executive compensation, transparency, ethics, and shareholder rights. Uses of ESG: Investment Decisions: Investors increasingly use ESG criteria to assess the sustainability and ethical impact of their investments. Companies with strong ESG practices are often seen as less risky and more likely to deliver long-term returns. Corporate Strategy: Companies use ESG factors to guide their strategies and operations, ensuring they are sustainable and responsible. This can help them build trust with stakeholders, improve their reputation, and drive long-term success. Regulatory Compliance: ESG considerations are increasingly being integrated into regulations, meaning companies must adhere to certain standards to avoid legal risks and penalties. Risk Management: By focusing on ESG factors, companies can better manage risks related to environmental damage, social unrest, and governance failures, which can have significant financial implications. Stakeholder Engagement: ESG frameworks help companies engage with a broad range of stakeholders, including customers, employees, investors, and communities, by demonstrating a commitment to ethical practices. ESG could be particularly relevant in discussing how the industry can improve its environmental practices, engage with communities, and govern its operations to ensure long-term sustainability and profitability. Environmental HERO SHAFIK HUSNI Others expertise: Environmental Audit GHG Audit Carbon Calculation / Verifier Certified Training: - GHG Verifier - Sustainability  - Environmental Management note : Presenting & Sharing with Bank & Stakeholder

ESRS 1 (European Sustainability Reporting Standard 1) is a standard under the European Union's Corporate Sustainability Reporting Directive (CSRD) that outlines the requirements for companies to report on their sustainability performance. Here's a summary of the key points: *Scope:* - Applies to all large public-interest entities (listed companies, banks, insurance companies, and large public undertakings) - Covers approximately 49,000 companies in the EU *Reporting Requirements:* - Companies must report on their sustainability performance using the double materiality approach (impact on the company and impact on the environment and society) - Reports must include: - A description of the company's sustainability strategy and goals - A description of the company's sustainability governance and management systems - Quantitative and qualitative information on sustainability performance (using EU-defined metrics and disclosures) - Information on climate change, biodiversity, human rights, and social and labor standards *Key Topics:* - Environmental: - Climate change (GHG emissions, transition risks, opportunities) - Biodiversity and ecosystem degradation - Water and marine resources - Pollution and waste management - Social: - Human rights (due diligence, forced labor, child labor) - Labor practices and decent work - Diversity, equity, and inclusion - Community engagement and development - Governance: - Sustainability governance and management systems - Risk management and internal controls - Ethics and compliance *Reporting Format:* - Reports must be published as a separate section of the company's annual report or as a standalone report - Reports must be digitally tagged using the EU's reporting framework (ESEF) *Timeline:* - First reports are due for the 2024 fiscal year (published in 2025) - Reports must be published within 12 months of the fiscal year-end This summary provides a high-level overview of the key points in ESRS. #CSRD #ESRS #materiality #sustainabilityreporting #ESG

I am happy to share that I have successfully obtained the Certification of Corporate Sustainability Reporting Directive (CSRD) Fundamentals from the CSRD Institute. #CSRD #Reporting #Sustainability

Every industry goes through its calibration and recalibration phases but it is time the scope of sustainability should be #rationalised so that companies and auditors get breathing space and meaningful outcomes can be achieved. Sustainability is business impact but off late it has been mostly compliance and reporting with a syllabus as big as a planet. Also, a good time for consulting firms and companies to redefine the #scope of work for sustainability professionals.

Guess what? Corporate Sustainability Reporting Directive (CSRD) has declared...... Excel No longer a Valid Tool for Reporting - who would have thought this day would happen? #sustainabilityreporting #reporting #compliance #dataleadership 🔗 Link to an article in the comments

Corporate preparers of Sustainability Reports should also be aware of the requirements of the new International Ethics Standards Board for Accountants (IESBA) new Exposure Draft on Sustainability Reporting and Assurance. Preparers and management or those charged with governance are the 'first line of defense against "greenwashing" and other corporate malfeasance'. The aim is to publish 'truthful, high-quality corporate sustainability disclosures'!

Our Sustainability Regulations Tool offers organizations a quick and easy way to assess their applicability to the various climate-related regulations that exist. Explore more with our new tool below!

Proposed International Standard on Sustainability Assurance 5000 https://lnkd.in/d6J9BFXR Part 1: The need to measure and report, with considerations for the assurance professional https://lnkd.in/d54R3McJ Part 2: Independent assurance engagements on sustainability information https://lnkd.in/dJxgehu7