Structuring Your Approach to CSRD: 10 Key Steps

/

The Corporate Sustainability Reporting Directive (CSRD) represents a fundamental shift in the European Union’s regulatory framework for sustainability reporting. Far beyond a routine compliance update, CSRD replaces the Non-Financial Reporting Directive (NFRD) with a significantly expanded scope, more demanding disclosure requirements, and a standardized reporting structure aligned with the European Sustainability Reporting Standards (ESRS).

Companies subject to CSRD cannot approach it as a check-the-box exercise. The directive establishes a new baseline for transparency and ESG accountability, mandating detailed, verifiable data across environmental, social, and governance pillars. It is designed to drive substantive integration of sustainability into corporate strategy, risk management, and stakeholder communication.

For affected companies, CSRD is both a compliance obligation and a strategic opportunity to lead on ESG maturity, meet growing investor and stakeholder expectations, and strengthen market positioning through credible sustainability performance.

Where should companies start?

Navigating the complex regulatory requirements of CSRD requires a clear, phased approach. Getting started now with these first practical steps will help ensure a smoother process toward meeting compliance.

1. Understand If and When CSRD Applies to You

The first step is to determine whether CSRD applies to your company, and when. The rollout is phased:

  • 2024 (reports due in 2025): Public interest entities already under NFRD (e.g., large listed companies, banks, insurers).

  • 2025 (reports due in 2026): All large EU companies (meeting two of: >250 employees, >€40M turnover, >€20M total assets).

  • 2026 (reports due in 2027): Listed SMEs, except micro-enterprises. Some may opt for a 2-year delay.

  • 2028 (reports due in 2029): Non-EU companies with substantial EU activity (€150M+ turnover in EU and at least one EU subsidiary or branch).

Even companies currently out of scope should prepare proactively, as early readiness can prevent costly last-minute scrambling. Recent revisions under the 2024 Omnibus Directive clarified timelines and thresholds, particularly for non-EU entities and SMEs.

2. Get Clear on the ESRS Standards

CSRD requires companies to report according to the European Sustainability Reporting Standards (ESRS). These are detailed and sector-agnostic (for now) and will be extended with sector-specific guidance in the future.

There are 12 initial standards:

  • 2 cross-cutting (general principles and disclosures)

  • 10 topic-specific (covering environmental, social, and governance issues)

Companies are required to report on all material impacts, risks, and opportunities across these standards. That means applying double materiality: assessing both how sustainability issues impact the company and how the company impacts people and the environment. Sector-specific and SME-proportionate standards are expected to follow in upcoming phases.

3. Set Up a Double Materiality Assessment

Double materiality is a key CSRD requirement, and it is where many companies struggle. A documented and defensible double materiality assessment is essential since it will also be subject to external assurance. Companies should establish a structured, documented process that involves stakeholder engagement and data analysis.

This process includes:

  • Identifying relevant sustainability topics

  • Stakeholder mapping (internal and external)

  • Gathering input (interviews, surveys, focus groups)

  • Scoring and prioritizing impacts, risks, and opportunities

The findings will guide what a company reports, and auditors will also want to see the company’s process. Under CSRD, this assessment must be reviewed at least annually, or sooner if significant changes occur in the company’s business strategy, operations, or stakeholder expectations.

4. Assess Your ESG Data Capabilities

CSRD reporting is data-heavy. For each material topic, companies need to report quantitative and qualitative metrics, which include:

  • GHG emissions (Scopes 1, 2, and eventually Scope 3)

  • Energy consumption

  • Pollution and resource use

  • Workforce demographics, pay gaps, training hours

  • Anti-corruption controls

  • Governance structures

To strengthen the ESG data collection process, organizations should:

  • Map required data points to existing systems

  • Identify gaps and manual processes

  • Invest in ESG data tools or platforms

  • Define roles and responsibilities for data owners

Treat this like financial reporting: accuracy, traceability, and auditability are critical.

5. Engage an Independent Auditor Early

Unlike previous ESG reporting schemes, CSRD reports require limited assurance from an independent auditor. That assurance scope is expected to increase over time.

A third-party auditor will:

  • Review the double materiality methodology

  • Verify ESG data and reporting processes

  • Assess systems and internal controls

Don't wait until the last minute to engage an auditor. Early involvement enables auditors to identify compliance risks and reporting weaknesses in advance.

6. Align CSRD With Existing Frameworks

Organizations already reporting under frameworks such as GRI, SASB, IFRS, or CDP can build on that foundation, instead of starting from scratch.

Use a mapping exercise to:

  • Identify overlaps between existing disclosures and ESRS

  • Reuse validated data where possible

  • Pinpoint gaps that require additional reporting or controls

It is important to note that alignment with another framework does not equate to CSRD compliance. CSRD is more detailed and prescriptive.

 7. Build a Cross-Functional CSRD Team

CSRD compliance is not something that a company’s sustainability or comms team can handle alone. It touches finance, HR, legal, IT, procurement, and more.

Set up a task force with clear leadership and accountability, which includes:

  • A project manager or PMO to drive timelines

  • Technical experts to handle data

  • Legal and risk advisors

  • Internal audit or controls specialists

Treat this like any major compliance program. Clear roles, governance structures, and accountability frameworks are critical for success.

8. Develop a CSRD Roadmap

Do not try to accomplish everything at once. Map out a structured and phased timeline that includes:

  • Double materiality assessment (and updates)

  • Stakeholder engagement

  • Data gap analysis and remediation

  • System upgrades

  • Drafting and assurance process

  • Governance reviews

Start with a diagnostic. What’s in place? What’s missing? How mature are the company’s processes? Use this to prioritize your roadmap and benchmark against peers.

9. Prepare for Scrutiny and Transparency

CSRD reports go into a company’s annual management report and must be digitally tagged in XHTML format. This makes the data:

  • Public and easily accessible

  • Standardized for comparability across companies

  • Subject to heightened scrutiny by investors, regulators, and stakeholders

Claims must be evidence-based and defensible. Companies should be prepared to substantiate every data point and narrative.

10. Think Beyond Compliance

CSRD is not just a reporting exercise, it is a chance to build real ESG maturity. Companies that approach this strategically can:

  • Embed ESG into strategic planning and improve risk management

  • Enhance investor confidence and access to capital

  • Align with customer and supply chain expectations

  • Strengthen governance and internal controls

By operationalizing sustainability through CSRD, companies can create long-term value and position themselves as credible, transparent, and future-ready. Done right, it becomes a competitive differentiator.

Final Thoughts

CSRD compliance is a complex undertaking, but with a systematic and proactive approach, it is entirely manageable. Success will not come from last-minute efforts to meet deadlines, but from treating this as a strategic business transformation.

Define applicability, build internal teams, establish data governance, and implement a detailed roadmap. The sooner a company starts, the smoother the path will be toward CSRD compliance.

KERAMIDA helps companies meet CSRD requirements with accurate GHG Emissions Inventories, double materiality assessment support, and third-party verification. We streamline data collection, support science-based target setting, and ensure compliance with evolving sustainability reporting standards. Contact us or call (800) 508-8034 to speak with one of our ESG compliance reporting experts.

Author

Faythe Missick, MA, MSc
Senior Manager, Sustainability
KERAMIDA Inc.

Contact Faythe at fmissick@keramida.com

Related Services