The Corporate Sustainability Reporting Directive (CSRD) is the most significant change to sustainability reporting in Europe. This guide covers everything you need to know for 2026 — which companies are in scope, what you must disclose, key deadlines and how to prepare.
What is the CSRD?
The CSRD replaces the Non-Financial Reporting Directive (NFRD) and dramatically expands the scope and depth of sustainability reporting requirements for European companies. It introduces the European Sustainability Reporting Standards (ESRS) as the mandatory reporting framework.
Who is in scope?
CSRD reporting requirements are being phased in over several years:
- 2025 (reporting on FY2024): Large public-interest entities already subject to NFRD (500+ employees)
- 2026 (reporting on FY2025): All large companies meeting 2 of 3 criteria: 250+ employees, €50M+ revenue, €25M+ total assets
- 2027 (reporting on FY2026): Listed SMEs (with opt-out until 2028)
- Non-EU companies: Companies with €150M+ EU revenue and an EU subsidiary or branch
What must you disclose?
The ESRS framework covers 12 standards across Environmental, Social and Governance topics:
- Cross-cutting: ESRS 1 (General requirements) and ESRS 2 (General disclosures)
- Environmental: Climate change, pollution, water, biodiversity, resource use and circular economy
- Social: Own workforce, workers in the value chain, affected communities, consumers and end-users
- Governance: Business conduct
Double materiality assessment
A cornerstone of CSRD is the double materiality assessment — companies must assess both:
- Impact materiality: How your company impacts people and the environment
- Financial materiality: How sustainability issues create financial risks and opportunities for your company
Only topics deemed material through this assessment need to be reported on (except ESRS 2, which is always mandatory).
How to prepare
Companies approaching CSRD compliance should:
- Conduct a double materiality assessment to determine which ESRS topics are material
- Map existing data sources and identify gaps across material topics
- Establish data collection workflows and internal controls
- Engage with value chain partners on Scope 3 and supply chain data
- Select an ESG platform that supports ESRS-aligned reporting with audit trails
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