How do you prepare for the CSRD legislation?
Mapping CO2 & Energy:
CSRD—you’re hearing and seeing it more and more often, but what exactly is it, and how should your business address it? In this article, we explain what the CSRD legislation is, why it’s a crucial step toward a more sustainable future, and how you can comply with it using practical tools like the CO2 & Energy RI&E.
John Koekenbier
Author
What is the CSRD?
CSRD stands for the Corporate Sustainability Reporting Directive. This European directive requires companies to report more transparently on sustainability and environmental impact. This includes reporting on CO2 emissions, energy consumption, and the impact on the environment and society resulting from waste management, among other factors. The CSRD replaces the older Non-Financial Reporting Directive (NFRD) and imposes stricter reporting requirements.
Essentially, the CSRD was initially aimed at companies subject to reporting requirements. These are large publicly traded companies that do business abroad, often on different continents. So it’s not really practical for small and medium-sized enterprises in our sector.
Nevertheless, small and medium-sized businesses will likely have to deal with this in the coming years. Not because they are required to report themselves, but because they are suppliers to those large companies. And those large companies will start asking questions of their suppliers.
In short, if your customers have to comply with CSRD regulations, so do you.
Why is the CSRD important?
The CSRD is an important step toward a more sustainable economy. By requiring companies to disclose their sustainability efforts, they are encouraged to make sustainable choices. But the benefits of the CSRD go beyond mere regulation:
Increased trust: Transparency regarding your sustainability policy builds trust among customers, partners, and investors.
Competitive advantage: Sustainability is no longer a nice-to-have, but a must. Companies that respond to this trend are better positioned in the market.
Future-proofing: By complying with the CSRD, you’ll be prepared for stricter environmental regulations and stakeholder demands in the future.
Strengthening partnerships: Failure to comply with the CSRD could result in the loss of opportunities to collaborate with supply chain partners. Naturally, you want to avoid this. Conversely, compliance with the CSRD opens up opportunities for new or strengthened partnerships.
The Challenge of Reporting Under the CSRD
Although the CSRD is valuable, it also presents challenges. Companies must collect detailed data on their impact on people and the environment. For many organizations, this is uncharted territory. For example, how do you start measuring CO2 emissions? And how do you ensure that your data is reliable and accurate?
Although there are currently no tools available for smaller businesses, an initiative for them is currently underway through Bovag and is now being tested in collaboration with Metaalunie. It is expected that this tool will not be ready for use by other sectors—and adapted to their specific industries—until at least the first quarter of 2025. In any case, it is already clear that identifying all potential stakeholders (not just existing business partners) and calculating the carbon footprint of your company and your products will be key components of the reporting. As a company, you could therefore start preparing for this now.
For example, you can use ClimateCalc for this purpose. This tool, in combination with the CO2 & Energy RI&E, is recognized by the government for the Energy Measures Reporting Obligation (EML) and for companies that must comply with the EED audit requirement. By familiarizing yourself with such a tool and the structure of CO2 footprint calculations for Scopes 1, 2, and 3, you develop internal expertise that will be necessary, among other things, during discussions with stakeholders regarding CSRD reporting.
The CO2 & Energy RI&E: A Smart Solution for CSRD Compliance
The CO2 & Energy RI&E (Risk Inventory & Evaluation) is a tool that helps companies assess their energy consumption and CO2 emissions. It helps you analyze the current situation, identify bottlenecks, and implement concrete improvements. But the CO2 & Energy RI&E does more than just collect data; it also offers a strategic approach to reducing your energy consumption and carbon footprint. The clear reporting aligns very well with the requirements of the CSRD and supply chain reporting.
Benefits of the Energy RI&E:
- Insight into energy consumption: You’ll gain a clear understanding of where your organization uses energy and where you can save.
- CO2 Reduction Plan: This tool helps you develop a concrete action plan to reduce your CO2 emissions.
- Efficient reporting: The Energy RI&E aligns seamlessly with the reporting requirements of the mandatory List of Approved Measures (EML), saving you time and effort when uploading the EML to the RVO website. You can submit your report directly from the platform!
- Cost savings: By reducing energy waste, you not only lower your environmental impact but also your costs.
Here are a few practical tips to get you started
If you want to start preparing for the CSRD and/or supply chain reporting, or if you have suppliers or customers who must comply with the CSRD, here are a few tips:
Collect data in a structured manner: Gathering the necessary data is an important first step in the process. The CO2 & Energy RI&E makes it possible to approach this process in a structured way and implement practical improvements.
Involve your team: Raise awareness within your organization about the importance of reducing CO2 emissions and managing energy consumption. Real improvement isn’t just a matter of paperwork—it’s about the daily actions taken on the job. So be sure to involve your employees from the very beginning!
Working with experts: Consider partnering with experts who can guide you to speed up and optimize the process and the outcome.
Make sustainability your priority
The CSRD legislation is more than just a requirement; it’s an opportunity to contribute to a more sustainable world and strengthen your organization’s position. With tools like the Energy RI&E, you can take the first step toward compliance easily and effectively.
Would you like to learn more about the CSRD or the Energy RI&E? Our team is here to help. Together, we’ll ensure that your organization not only complies with the law but also makes a positive impact on the future.