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illuminem summarizes for you the essential news of the day. Read the full piece on Thomson Reuters Institute or enjoy below:
🗞️ Driving the news: As the European Union’s Corporate Sustainability Reporting Directive (CSRD) approaches its first reporting deadline, many companies face challenges with compliance due to lack of guidance, short timelines, and extensive reporting requirements
• These issues may lead some companies to opt for noncompliance or poor implementation in the short term, as they await more clarity and best practices.
🔭 The context: CSRD aims to bring sustainability reporting on par with financial reporting by requiring companies to disclose their environmental and social impacts comprehensively
• However, sustainability professionals express frustration over the complexities of double-materiality assessments and the absence of clear guidelines for assurance
• These complications could benefit consulting and law firms, potentially driving up costs for businesses seeking compliance support
🌍 Why it matters for the planet: Effective implementation of CSRD is crucial for enhancing corporate transparency and accountability in environmental and social governance
• Inconsistent or delayed compliance could dilute the directive's goal of providing accurate and comparable sustainability data, undermining global efforts to address climate change and social issues
⏭️ What's next: While some companies may initially struggle or choose noncompliance, sustainability leaders advocate for gradual course corrections to improve guidance and timelines
• As best practices emerge, it is expected that compliance will become more streamlined, helping companies to integrate sustainability more deeply into their core operations
💬 One quote: “It is going to be a bumpy ride, and it will be hard for a lot of businesses to get going. Over time, though, reporting will get easier — and fundamentally we think both pieces of regulation are important steps forward,” said Nick Wyver, Consultancy Director at SB+CO
📈 One stat: The CSRD requires businesses to report on over 1,000 data points related to sustainability, significantly increasing the complexity and scope of reporting compared to previous standards
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