Corporate Sustainability Reporting Directive (CSRD)

Overview Summary

The Corporate Sustainability Reporting Directive (CSRD) strengthens and standardises sustainability reporting across the EU by replacing the former Non‑Financial Reporting Directive. It requires in‑scope companies to disclose their sustainability risks and opportunities and the impacts of their activities on social, environmental and governance issues. The directive elevates sustainability disclosures to the same level of importance as financial reporting.

Scope of Coverage

CSRD applies to companies required to report under the European Sustainability Reporting Standards (ESRS). It covers disclosures related to:

– Environmental matters—including climate change, pollution, water and biodiversity
– Social matters—including workforce, value chain workers and affected communities
– Governance matters—including business conduct

The scope and reporting requirements were adjusted by the Omnibus simplification package, which narrowed the number of entities in scope and revised thresholds.

Affected Entities

EU Companies
– Over 1,000 employees
– Net turnover above €450 million

Non‑EU Companies
– Net turnover above €450 million generated in the EU for each of the last two financial years
With an EU subsidiary or branch exceeding €200 million net turnover

Exemptions & Adjustments
– Financial holding companies are exempt
Wave 1 companies falling out of scope must continue reporting until fiscal year 2027, unless their Member State grants an exemption following Omnibus I adoption.
– SMEs out of scope are protected from excessive information requests from in‑scope companies

Applicability & Compliance Timeline

EU Companies
– Over 1,000 employees
– Net turnover above €450 million

Non‑EU Companies
– Net turnover above €450 million generated in the EU for each of the last two financial years
With an EU subsidiary or branch exceeding €200 million net turnover

What This Means for Companies

Companies need reliable sustainability data, a clear double-materiality assessment and internal processes that support financial‑grade governance for ESRS reporting. They must also ensure supplier information is consistent and traceable.

Meo Carbon Solutions supports organisations by building data systems, preparing ESRS‑aligned disclosures and guiding companies through Omnibus‑related changes and transition periods.