Sustainability encompasses more than purely ecological aspects

Currently, the big swing towards a sustainable economy is taking place. In accordance with the European Corporate Sustainability Reporting Directive (CSRD for short – the new EU directive on CSR reporting), a company’s own success story in the direction of sustainability must be aligned with the following three aspects:

  • Environment
    Well-known topics such as climate protection and change, resource use and circular economy, environmental protection, biodiversity and ecosystems
  • Social
    Equal opportunities, training and qualification as well as employee participation, work-life balance, suitable working environment
  • Governance
    Business practices, risk management, corporate ethics and culture, including anti-corruption and anti-bribery, political engagement, lobbying activities

How is sustainable, “taxonomy-appropriate” strategy work done in the company?

These three aspects must be anchored across all levels in the organization – ideally by adapting the strategy. Similar to what is suggested in the Taxonomy Regulation, the key sustainability issues need to be identified and prioritized. Click here for the Taxonomy gleanings.

Different perspectives can be taken into account in a materiality analysis:

  • Inside-Out Perspective: Impact of the Organization on Ecology, Society and Social Issues
  • Outside-In Perspective: Financially Valued External Influence on Company Value, Performance and Development
  • Interest-group perspective: interests, requirements and expectations of relevant stakeholders for the organization
  • Assignment to ecology, social affairs and governance: thematic fields or focus of thematic content

The findings can be presented graphically in the materiality matrix, as shown in the following simplified example. Topics in the upper right area or large topics are recognizable as the most important and should be the focus.

Fig.1: Example of a materiality matrix

Do you have to? What to tell the outside world soon….

The objectives of the planned CSRD directive are to noticeably increase systematic activities and transparency in the area of sustainability. The new stricter requirements are more comprehensive and affect around four times more companies within the EU than before.

The European Council as well as the European Parliament propose the following step-by-step model for the implementation of the CSRD, which is currently being finalized:

  • From the beginning of 2024 for companies already subject to the previous NFRD (Non-Financial Reporting Directive, predecessor of the CSRD) (first reporting with 2025 over 2024);
  • From the beginning of 2025 for large companies that are currently not subject to the NFRD: Companies with an annual average of 250 or more employees, a balance sheet total of more than 20 million euros, sales of more than 40 million euros – if two of these three size criteria are exceeded, the first reporting obligation applies beyond 2025.
  • From the beginning of 2026 for listed SMEs and for small and non-complex credit institutions and captive insurance companies (first report with 2027) with an opt-out until 2028.

Save the Date

If you would like to gain an overview of sustainability management and receive suggestions for the practical handling of sustainability topics, I recommend the online training “Designing and managing for the future” on 29.11.2022, which I am holding for qualityaustria.

Get into the “doing

In our experience, the sustainability issue can be strategically anchored and holistically implemented with the help of the EFQM approach. We are happy to support you in identifying essential topics and telling your success stories – in accordance with legal deadlines and requirements. In this way, your contribution to a sustainable future is given the appropriate status, including comprehensible presentation to important stakeholders.

For the handling of “operative” topics we accompany you not only in the classical consulting. Within the framework of our company group we also look “technically” at many successful projects of VOIGT+WIPP Engineers as Energy Service Company (ESCO). Our energy saving projects range from the analysis to the sustainable and economic use of the achieved optimizations.

Sources and further links:
Corporate Sustainability Reporting Directive (CSRD for short)
Taxonomy regulation
Quality Austria Blog Article: What do the new reporting requirements (CSRD) mean for companies?

Webinars / Seminars:

Quality Austria Online Training: Designing and Managing for the Future – Sustainability Management in Practice
Quality Austria Seminar: “Taxonomy Regulation and Implementation/Audit of the Corporate Sustainability Reporting Directive”.
BMK Taxonomy Webinar Series in Fall 2022