On Friday, June 9, 2023, a new update of the ESRS was published. These standards prescribe the processes and data points that need to be applied for the purpose of sustainability reporting under the CSRD. What stands out are increased levels of detail, clarity, and flexibility.
The new update of the European sustainability reporting standards reveals several significant changes compared to the previous update in November 2022. Over the next four weeks, feedback can be provided on the current version, after which the commission will work on the final version.
What stands out in the current update is that the core remains largely the same, but there have been considerable relaxations in the implementation of certain points.
Materiality becomes even more important
What becomes evident in the current version is that in the previous iteration, certain topics, particularly related to climate change, were mandatory. However, in the latest version, this is no longer the case. The materiality analysis now determines whether reporting on all topics is required or not.
What does this mean in practice? For most organizations, the topics that were previously mandatory are likely to emerge as material subjects during the materiality analysis. It is challenging to envision a scenario where climate change, for instance, is irrelevant to an organization in any way. Therefore, conducting a thorough and well-substantiated materiality analysis becomes even more crucial.
Core remains the same, more details
In essence, much has remained the same, providing reassurance to companies that have already commenced their CSRD preparations. The approximately 100 topics that need to be assessed for materiality have largely remained unchanged.
What stands out in this context? There is more detailed guidance on certain topics, such as pollution. For instance, the topic of Microplastics has been added, explicitly requiring organizations to determine if it is a subject that should be included in their sustainability reporting.
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More instructions and flexibility
The new guidelines are much clearer, more specific, and provide more examples to illustrate the process of CSRD preparation. They also offer increased flexibility, allowing for a phased approach in reporting on various data points.
The new ESRS guidelines also provide clear instructions on how to conduct the materiality analysis and engage stakeholders. This remains a central concept and forms the foundation of the CSRD sustainability report.
Update in Ecocharting: additional subjects and datapoints
The adjustments in the CSRD guidelines are being implemented in Ecocharting. These primarily consist of several minor content changes and additions. The central process in our software, the dual materiality analysis, remains largely the same in terms of execution.
Curious about how our software works? The dual materiality analysis can be quite challenging. That’s why we offer our software, which is fully aligned with the guidelines and designed in collaboration with sustainability experts and accountants. Request a demo below to see it in action!
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