What are ESG reports?
In a sustainability report, a company provides insight into its strategy and policy on sustainability, how it implements it and how it scores on the various metrics. Sustainability, or ESG, stands for Environment, Social and Governance.
Why sustainability reporting?
In the 2015 Paris Agreement, countries agreed to limit global warming to below 2° Celsius, with a clear view of 1.5° Celsius. The European Union has translated this into measures and policies (the Green Deal) to be climate neutral by 2050. One of these measures is that companies must provide a sustainability report to show how sustainable they are enabling investors and banks can decide where to invest or provide credit. The Corporate Sustainability Report Directory (CSRD) includes the obligation to prepare such a sustainability report. In the coming years, more and more companies will have to comply with this CSRD (and other directives). To avoid having to prepare retrospective data or reports, it is advisable to start now. Before you have determined what and how you will report, you will first have to think about what you will report on.