The updated (February 2025) CSRD sets out mandatory sustainability reporting requirements for EU and EEA companies.
How can concrete producers and construction companies simplify the process?
What is the Corporate Sustainability Reporting Directive?
The Directive (EUR-lex, 2022) introduces mandatory reporting requirements for organizations operating in or linked to the European Union and the European Economic Area.
The standards applied by the directive are called European Sustainability Reporting Standards (ESRS).
Companies must comply by:
- 2025 If more than 500 employees, NFRD and CSRD are applied.
- 2026 If the company operates in the EU and has more than 250 employees, a turnover of more than €50 million or assets of more than €25 million.
- 2027 If the company is an SME operating in the EU.
- 2029 It is a non-EU enterprise with significant activities in the EU, EEA.
Here is what to do.
Estimate the operational consequences and impact of the company.
- In line with the CSRD, companies are required to identify and assess their sustainability impacts, risks and opportunities based on the European Sustainability Reporting Standards (ESRS). This includes an analysis of the environmental, social and governance (ESG) implications of the processes, as well as consideration of the entire value chain – including upstream suppliers, downstream customers and indirect relationships. The whole supply chain.
The standards include environmental, social and governance aspects, following the ESG model. With our concrete.fit and OpenLCA-based life cycle assessment, you can collect and report data on:
- Climate change
- Pollution
- Water and marine resources
- Biodiversity and ecosystems
- Resource use and circular economy
Calculate impacts
- Based on materiality assessments (EFRAG, 2023), impacts are generally outlined as follows:
- For current impacts, the materiality criterion is based on its severity, its magnitude, its extent and its irremediability (only for negative impacts).
- For potential impacts, the prioritisation is based on severity and likelihood.
- The thresholds for the importance of impacts are set by the companies themselves. Any discrepancies should be disclosed and is examined at the time of the audit.
- Financial materiality is determined when an impact has, or can reasonably be expected to have, significant financial consequences. This includes risks or opportunities that could have a significant effect on future development, financial position, performance, cash flows, access to finance or the cost of capital.
All impacts should be assessed in the following timeframes:
- Short-term: one reporting year.
- Medium-term: Up to five years.
- Long-term: Beyond five years.
The process for identifying significant impacts (ESRS IRO-1) should be documented.
Identify future plans and provide details.
- ESRS E1-1 A transition plan to achieve climate neutrality by 2050, including mitigation measures and decarbonisation instruments.
- ESRS E1-4 Targets for greenhouse gas (GHG) emission reductions for GHG emissions in Scopes 1, 2 and 3, separately or in combination.
- ESRS E1-6 Gross and total GHG emissions from Scope 1, 2 and 3, including emissions from each major Scope 3 category.
- ESRS E2-4 Air, water and soil pollution – quantification of pollutants (e.g. ozone depleting substances, acidification, eutrophication).
- ESRS E3-4 Water consumption – quantify water use.
- ESRS E4-5 Impact measurements on biodiversity and ecosystem change, including land use and biodiversity stress.
- ESRS E5-3 Targets for resource use and circular economy – circular materials, primary materials and sustainable sourcing.
- ESRS E5-4 Resource inputs – technical and biological weights; percentage of materials sustainably sourced; weight and percentage of secondary recycled, reused components, intermediates and materials.
Report
- Under the CSRD Directive, only the first and second parts of the ESRS are mandatory, the former covering the requirements and the latter the disclosure elements of the report.
Prepare the sustainability statement
- The ESRS sets out minimum criteria and a standardised format for the sustainability statement. This statement should be included in or published at the same time as the company’s management report.
Work with an auditor
- Sustainability statements are audited by auditors. The audit is carried out by a statutory sustainability auditor, but auditors may also be appointed in EU Member States. The statutory auditor must prepare a detailed report on the findings and an opinion based on the assurance standards set by the European Commission.
Disclose
- In addition to being submitted in the appropriate format, CSRD reports should be machine readable and the data should be prepared in a format suitable for automated processing. The technical format follows the XBRL guidelines and complies with the standards of the European Standardised Electronic Format (ESEF).
The author of the article is Bálint Katona, innovation and sustainability expert.
For more information on the services described in the article, please contact our colleagues.