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Novata CSRD Simplified

November 2024

From Strategy to Spend: How Companies Are Preparing for CSRD Compliance

The Corporate Sustainability Reporting Directive (CSRD) is a challenging reporting requirement affecting companies in the EU and around the world. Novata surveyed the landscape to understand how prepared companies feel, the biggest challenges they face, and the support they need to comply with the CSRD.

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PREPAREDNESS

Preparedness levels for CSRD compliance vary widely.

Nearly

25%

of respondents were uncertain of their first CSRD disclosure date.

But more than 

50%

of those with dedicated in-house ESG teams expressed confidence in meeting CSRD requirements.

Written by

Neil McCall

Senior ESG Analyst, Advisory, Novata

Laura Callaghan

Laura Callaghan

Associate Director, Advisory, Novata

Tiziana Antonietti

Manager, Advisory, Novata

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CHALLENGES

Data collection and management was listed as the most significant hurdle.

But only

29%

of companies have engaged a CSRD technology provider.

Other top hurdles include understanding regulatory requirements and conducting the Double Materiality Assessment (DMA).

COSTS

CSRD compliance is expected to carry a substantial financial burden, particularly in the initial years.

€100,000

51% of respondents anticipated annual costs to exceed this figure.

Most large organisations expect to spend over €50,000 on key areas like data collection, management, assurance, and the DMA.

Costs are expected to be proportional to organisation size, as larger organisations have more data to collect and assure, as well as more complex value chains to assess for their DMA.

OPPORTUNITIES

CSRD compliance offers benefits beyond regulatory adherence—it provides an opportunity to enhance risk management and align corporate strategy with sustainability goals.

To optimise compliance, early engagement with key stakeholders is essential.

Companies should consult legal advisors to define reporting boundaries, work with auditors to streamline assurance processes, seek support from advisors for the DMA and stakeholder engagement, and collaborate with technology providers to ease the burden of data collection and reporting.

Who have companies engaged?

69%

Consultants

47%

Accounting firms

36%

Legal firms

29%

Technology providers

ABOUT THE REPORT

The survey was conducted by Novata during September and October 2024, yielding 59 responses. Most of these respondents were from private companies (66%), but there was also representation from public companies (22%) and investment firms (12%). The geographical distribution aligned with expectations, with 83% of respondents headquartered in Europe.

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Companies brace for steep compliance costs— how high will they go?

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