In Charts: 8 out of 10 companies not subject to EU’s CSRD still intend to comply

The majority of US and UK companies not covered by the EU’s Corporate Sustainability Reporting Directive plan to meet its demands

More than 80 per cent of companies not subject to the EU’s Corporate Sustainability Reporting Directive still intend to align some or all of their reporting strategies with the legislation, a global survey of those working in environmental, social and governance roles has found.

The CSRD requires large EU companies and non-EU businesses that generate more than €150mn on the EU market to report annually on their sustainability impact. Companies must publish their first reports in 2025.

The survey, conducted by US reporting software company Workiva, found that the CSRD is influential in jurisdictions beyond the EU. In North America, 86 per cent of respondents not subject to the CSRD still intend to comply, along with 72 per cent of UK respondents. 

Workiva says the results, taken from 2,204 professionals working in ESG reporting, show businesses are motivated by other considerations than simply complying with reporting requirements.

Companies are seeing a “positive impact on decision-making and value creation” from ESG reporting, Workiva says. The survey found that 84 per cent of respondents agree integrated financial and sustainability reporting enables better decision-making that can “improve a company’s financial performance”. Meanwhile, 88 per cent say integrated reporting will have a “positive impact on a company’s long-term value creation”.

Sustainability reporting also makes companies more competitive, the survey suggests. A vast majority (88 per cent) of the ESG practitioners say that having a strong sustainability reporting programme “will give their organisation a competitive advantage”.

Reporting remains ‘challenging’

Nonetheless, companies admit the reporting process is “challenging”. Of the ESG practitioners surveyed, 87 per cent say they “find it challenging to adapt reporting processes to comply with new regulations”. Additionally, 69 per cent of all ESG practitioners worldwide say disclosing their sustainability strategy under the CSRD is challenging.

Companies’ data accuracy shows a ‘disconnect’

Almost all practitioners (98 per cent) say they have “confidence in the accuracy of their ESG data”, even if 83 per cent of them added that collecting accurate data to fulfil the requirements of the CSRD will be “a challenge”.

Carbon Disclosure Project founder and chair Paul Dickinson describes the difference in these two results as a “disconnect” in Workiva’s report. This distinction suggests “existing ESG reporting practices must mature to satisfy new regulatory requirements”, he adds.

Vice president of regulatory strategy at Workiva, Andie Wood, tells Sustainable Views that this disconnect is likely the result of the fact that “the CSRD has mandated reporting”.

“The directive raises sustainability reporting to the same level as financial reporting introducing consistent standards, digitisation and an assurance requirement which requires a new level of knowledge,” she adds.

Supply chains pose problems 

In addition to the CSRD, large European companies are preparing to report in line with the EU’s Corporate Sustainability Due Diligence Directive, which requires transparency on the environmental and human rights performance of companies’ supply chains.

Of the practitioners surveyed by Workiva, 78 per cent are “concerned” with their company’s ability to collect and share information in line with the CSDDD.

The CSDDD was approved by the European parliament on April 24. If given final sign-off next month by EU member states, companies with more than 5,000 employees and a turnover of €1.5bn will have to begin reporting in 2027.