⭕ Why does Harvard Law School Forum on Corporate Governance write that CSRD is the north star of sustainability reporting?
➡ As CSRD represents the most comprehensive sustainability reporting framework to date, ambitious organizations beyond its scope of applicability will see it as their north star.
➡ The comprehensive double materiality approach for the European standard will largely fulfill the materiality requirements of other regulations.
➡ The expanded scope of CSRD – designed for use by a wider group of stakeholders beyond investors – means that EU companies with business ties in jurisdictions covered by ISSB that are already making CRSD-compliant disclosures (according to the European Sustainability Reporting Standards, ESRS), including those related to climate change, should in principle satisfy any non-EU requirements.
With mounting regulations, there is a clear imperative for companies to prepare in advance for legal compliance and, in equal measure, stakeholder expectations.
⭕ Priorities: where to start?
Strengthen sustainability governance.
Disclosures around procedures, controls and practices for the oversight and management of sustainability matters are central elements of both ESRS and the ISSB’s standards.
⭕ How can proactive companies take advantage?
Design one operating model to comply with multiple regulations, especially for companies captured by several regulatory regimes, with different phase-in requirements.
Design robust governance, processes and controls to support implementation, particularly as the quality of these is likely to be scrutinized under the applicable assurance engagements.
⭕ No regrets actions: early adoption vs regulatory imperative
The regulatory direction of travel is clearly towards increasingly robust sustainability reporting requirements.
Companies that act now will benefit from early progress towards looming reporting deadlines, avoiding potential delays caused by operational constraints.
Early adopters will benefit from additional time to understand their material topics and develop the appropriate metrics, processes and controls to report on those topics, with future assurance requirements in mind.
Early adopters will find it easier to retain and attract talent.
⭕ Achieving CSRD excellence
You are welcome to contact us if you need a solution to achieve sustainability strategy, governance and reporting excellence – to protect and grow your business.
Source: A Global Baseline? How to Navigate Interoperability Across Sustainability Reporting Rules