CSRD – Current status

The CSRD came into force at the EU level on 5th January 2023 and is considered a significant expansion of the previous EU directives on non-financial reporting. Member states are required to transpose the CSRD requirements into national law within 18 months of its entry into force. This means that Germany must amend its national laws by July 2024 at the latest.

Affected companies are obliged to implement the following three:

• The sustainability data prescribed by the CSRD must be entered into an EU database.

• To simplify access to sustainability information, the CSRD data will in future be a mandatory part of the (consolidated) management report and must be prepared in a uniform electronic format in accordance with the ESEF regulation. This highlights the increasing importance of sustainability reporting, which is gradually expected to achieve the same status as traditional financial reporting. This report will then be audited by an external auditor.

• Companies must submit a report annually.

For Germany, the implementation of this directive is not only a legal obligation but also an opportunity to enhance sustainability standards within companies. The aim is to achieve and adhere to the 1.5-degree climate target.