Scholarly record

THE ROLE OF CSRD REPORTING IN THE LOW-EMISSION TRANSITION

Anna Bluszcz

Abstract

This article examines the new corporate sustainability reporting requirements under the Corporate Sustainability Reporting Directive (CSRD), which represents a significant regulatory step towards strengthening transparency and accountability regarding the environmental impact of businesses in the European Union. Growing regulatory pressure, stakeholder expectations, and the urgent need to address climate change in recent years have driven the need for more comprehensive, standardized, and credible non-financial reporting. In this context, the CSRD introduces a harmonized framework that significantly expands the scope and detail of environmental, social, and economic disclosures. The article examines the key changes introduced by the CSRD compared to previous legislation, particularly the Non-Financial Reporting Directive (NFRD). These changes include the extension of reporting obligations to a broader group of entities, including, in the near future, small and medium-sized enterprises (SMEs), the requirement to use harmonized European Sustainability Reporting Standards (ESRS), and the obligation to have reported information independently verified. The directive also emphasizes the principle of double materiality, requiring companies to disclose not only how sustainability issues impact their financial performance but also how their activities impact the environment and society. This change significantly increases the complexity of reporting processes and necessitates the integration of sustainability into core business strategies. The paper identifies the main challenges facing large companies in adapting to the new requirements, as well as those likely to affect SMEs once they are subject to the regulations. Particular attention is paid to environmental reporting, with particular emphasis on estimating carbon footprints as a key indicator of a company's environmental performance. The paper discusses methodological approaches to calculating greenhouse gas emissions, including Scope 1, Scope 2, and Scope 3 emissions, emphasizing the growing importance of emissions across the value chain for achieving a comprehensive understanding of a company's environmental impact. Estimating Scope 3 emissions poses significant challenges due to data availability, supplier involvement, and methodological variability. However, accurate carbon accounting is essential for setting credible emission reduction targets, monitoring progress, and meeting the expectations of regulators and stakeholders. To assess the current status of CSRD implementation, a review of selected corporate sustainability reports was conducted to determine the level of advancement in implementing the new reporting requirements. The analysis reveals varying levels of advancement and preparedness for the new requirements, with some companies demonstrating a high degree of preparedness, including integrating ESG metrics into strategic decision-making processes and utilizing advanced data management systems. Others, however, remain in the early stages of implementation, often limiting their disclosures to qualitative descriptions and lacking robust quantitative metrics. This disparity highlights the uneven pace of adoption and underscores the need for further guidance, capacity building, and technological support.

Publication details

Back to publication list