As corporate reporting requirements continue to evolve, planning and reporting systems must adapt to cover an ever-wider range of topics. One critical area is ESG (Environmental Social Governance) reporting, which aims to enhance transparency on companies' sustainability performance and enable stakeholders to make informed decisions. New EU regulations, the CSRD and ESRS, will fundamentally transform corporate reporting practices from 2025, and as a result, a growing number of companies will be legally obliged to produce standardized ESG reports.
The European Union's Corporate Sustainability Reporting Directive (CSRD), set to take effect in 2025, will make ESG reporting mandatory, providing a more accurate and comparable view of companies' sustainability performance. The CSRD also requires mandatory auditing of sustainability reports to ensure their credibility and accuracy.
The scope of reporting will also expand: until now, it was mainly large companies that were obliged to prepare sustainability reports. However, with the introduction of the CSRD, this scope will be significantly broadened to include medium-sized and certain smaller companies—especially those that are publicly listed. In our upcoming blog post, we will also look deeper into the specific entities subject to these expanded obligations.
The implementation of the CSRD is closely linked to the European Sustainability Reporting Standards (ESRS), which outline how companies should prepare their sustainability reports. The European Financial Reporting Advisory Group (EFRAG), under the supervision of the European Commission, is responsible for developing these standards.
The ESRS provides detailed guidance on the data companies should collect and disclose in their ESG reports, including:
Together, the CSRD and ESRS will ensure that companies' sustainability reports meet EU standards.
ESG reporting will bring significant changes to companies from 2025, posing new challenges for Business Intelligence systems. These systems will be central to data collection, requiring the capacity to effectively manage and interpret complex data from multiple sources.
Additionally, large companies will need to report not only their own data but also automate data collection from their suppliers using BI systems. The reporting requirements go beyond just gathering and standardizing past data; they also involve setting future goals, which demands advanced software planning tools.
KnowledgeSeed is ready to meet these new challenges. Our solution will effectively support our partners in producing CSRD and ESRS-compliant reports. Stay tuned!