July 8, 2024

How to Prepare for the CSRD: A Comprehensive Checklist

The Corporate Sustainability Reporting Directive (CSRD) aims to give companies clear guidelines for sustainability disclosures, ensuring the information is reliable, comparable, and relevant to key stakeholders. This directive uses the European Sustainability Reporting Standards (ESRS) as the framework for companies to report necessary sustainability data.

The required disclosures cover a wide range of information, and these sustainability statements must be verified by a statutory auditor or an independent assurance services provider (IASP). Initially, the assurance will be limited, with plans to move towards reasonable assurance by 2028, based on feasibility assessments for auditors and companies.

Navigating the ESRS can be overwhelming for companies. It’s crucial to ensure all collected data and results meet assurance standards. Our CSRD Checklist below outlines the steps companies need to take to comply with the regulation.

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How to Prepare for the CSRD. Download Checklist
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1. Assess Applicability

Determine if your company falls within scope of the CSRD.

  • Get started using our CSRD Assessment and seek legal advisory to help with this step.

2. Understand Requirements

Familiarize yourself with the specific reporting requirements under the CSRD, including the types of information to be disclosed and the format for reporting.

  • Undertake a gap analysis of your current positioning to identify gaps and next steps.
  • Speak to one of our ESG experts to learn more about our ESRS Readiness Assessment.

3. Set Up Governance, Engage Experts, Educate Workforce

Set up a governance structure for sustainability reporting, including assigning roles and responsibilities. Plus, plan for the assurance process.

  • It would be beneficial to set up a CSRD Task Force consisting of cross-functional representatives from across the business, including stakeholders such as HR, Operations, Risk, and Legal.
  • Educate your stakeholders on the CSRD, what it means for your business, and how it can help your business better assess and manage sustainability-related impacts, risks, and opportunities.
  • Engage with independent third-party auditors as early as possible to ensure your process is going to meet their audit criteria. They will review and validate your sustainability information.

4. Conduct a Double Materiality Assessment

Completing a double materiality assessment will help identify the most relevant ESG issues  

for your company.

  • You could do this in-house or seek expert support to complete the assessment for you. Explore Novata’s double materiality offerings.
  • Use any learnings to inform your sustainability due diligence process. Findings from your existing due diligence process should also inform your double materiality assessment. 
  • Based on the results, develop and document policies and procedures that may have been identified as missing in your assessment.

5. Develop Processes for Data Collection and Management

Companies may need to collect up to 1,200 data points for the CSRD, making it crucial to establish robust data management systems early.

  • Identify internal and external sources of sustainability data.
  • Implement or upgrade your data management systems to capture, process, and report required information.
  • Establish controls and procedures to ensure the accuracy, completeness, and reliability of  sustainability data.

6. Data Collection and Information Gathering

Although some data points were gathered during your double materiality assessment, conduct a full pilot data collection to identify gaps and areas for improvement.

  • Aim to complete a full round of data collection in accordance with the ESRS and the topical standards identified from your double materiality assessment.
  • Using this first round of data collection, work to identify gaps, areas of prioritization, and solutions to improve ahead of your disclosure year. Learn more about Novata’s CSRD Optimization offering.

7. Stay Updated

Keep abreast of developments in sustainability reporting standards and practices.

  • Continuously improve your reporting processes. One thing to be particularly aware of is the sector-specific standards in development as these may result in additional guidance or changes to your disclosure requirements.

The Sooner You Start, The Better

  1. Access the full checklist and start to prepare for the CSRD.
  2. Take our CSRD Assessment to find out when your company needs to report.
  3. Download our CSRD Guide to understand what is involved.
  4. Speak to an expert to set you on the path to CSRD success!