Green Finance

As soon as June 2023, the EU’s Corporate Sustainability Reporting Directive (CSRD), perhaps one of the most impactful sustainability reporting regulations under development, will be strengthened by a comprehensive suite of requirements, namely the first set of European Sustainability Reporting Standards (ESRS). On top of these requirements, the second set of ESRS will mandate additional sector-specific environmental disclosures at the granular level, to be developed in the latter half of 2023. All EU and EU-listed companies in scope, amounting to 50 000 entities, will have to implement these requirements as early as 2024 for annual reports published in 2025.

Corporates must start now and move quickly to remain compliant with the CSRD and the subsequent consolidations of environmental disclosure requirements. Specifically, adopt the ESRS standards as soon as they are approved by the European Commission in June 2023, and use 2023 as the preparation period to upgrade the reporting capabilities and the supporting IT systems.

Engaging in digital transformation to implement an IT architecture that supports climate reporting is a solution that yields both short and long-term benefits. An upgraded IT system can incorporate the latest climate reporting technologies into the organisation’s existing architecture and thus automate and scale the process of environmental disclosures: from data collection and analysis to report creation and automated submission. The opportunity cost of not upgrading the IT support systems greatly outweighs its set-up cost, especially as the environmental reporting regulation is strengthening.

Now is the time to start the digital transformation that will secure your organisation’s seamless transition to the new environmental disclosure standards of 2024 and beyond.