What does the CSRD (Corporate Sustainability Reporting Directive) entail?
With the aim of increasing transparency and reporting on corporate sustainability and environmental impact, the European Union published in December 2022 Directive (EU) 2022/2464, better known as CSRD, which replaces the previous directive and significantly expands the non-financial reporting obligations for companies.
In order to standardize the disclosure of this information, the ESRS (European Sustainability Reporting Standards) have been issued, comprising the European standards established for environmental, social and governance (ESG) aspects. A second set of specific standards adapted to small and medium-sized enterprises (SMEs) is expected to be published soon.
🏢 Which companies are affected?
Compliance will be phased in between 2024 and 2029, with the first filing in 2025.
The CSRD application is distributed as follows:
>Fiscal year2024 (filing in 2025): Companies that were already subject to the previous directive, NFRD (Non-Financial Reporting Directive). These companies met the following 3 criteria:
-More than 250 employees
-More than 40 M€ turnover
-More than €20 million in assets
>Fiscal year2025 (filing in 2026): Companies that meet at least 2 of the above 3 requirements.
>Fiscal year2026 (filing in 2027): Listed SMEs, except microenterprises, and other companies such as financial institutions and insurance and reinsurance companies. These companies may request the opt-out during the first 2 years of application of the directive.
>Fiscal year2028 (filing in 2029): Non-EU companies with subsidiaries in the EU with more than €150M turnover.
🧩 Prepare your company with Business Central's Sustainability Module
CSRD and Business Central
Microsoft Dynamics Business Central adapts to new information needs by increasingly expanding its sustainability module and ensuring compliance with the CSRD.
>Gatherthe information:
Set your company's parameters using sustainability settings
Calculates greenhouse gas (GHG) emissions with the help of emission rates
Structure data using the sustainability chart of accounts
Categorizes sustainability accounts to define the scope of emissions, their typology and the calculation of emissions.
Record emissions through sustainability journals, purchasing documents and general journals with CSRD and Business Central.
Offsetting your emissions by purchasing carbon credits
Manage sustainability certificates and assign them to your suppliers and products to ensure the sustainability of your operations.
Stores transaction history on sustainability movements
>Planyour objectives:
It tracks emissions progress and compares different scenarios through scorecards and the setting of sustainability targets.
>Analyzethe results:
Use the analysis mode on sustainability movements to obtain ad hoc reports of the data
Benefit from Business Central's integrated reporting to exploit emissions data
Configure financial reports to obtain sustainability results and combine them with accounting, statistical or budgetary results.
>Connectsto other applications:
Use Business Central's available API's to integrate your information with external applications, allowing you to publish and receive data.
Tracks emissions progress and compares different scenarios through dashboards and sustainability target setting
Want to know more about Business Central's sustainability module? Contact us! CSRD and Business Central
