Recently, Alex Hardwick, Director of Sustainability Planning & Enablement at Cority, sat down with Pete May, co-founder of Trellis Group, for an insightful conversation on the complexities of the EU’s Corporate Sustainability Reporting Directive (CSRD) and how companies can approach it strategically to achieve CSRD success.
During the exclusive interview, Alex shared valuable insights on CSRD, a topic that’s top of mind for many companies and often seen as a compliance hurdle. With the new Omnibus Proposal, it’s clear that regulatory expectations are constantly evolving but CSRD is still shaping the sustainability reporting landscape. Here are some key takeaways from the discussion:
1. The Importance of Gap Analysis in CSRD Strategy
One of the most critical yet often overlooked aspects of crafting a CSRD strategy is conducting a thorough gap analysis. Many companies rush through the double materiality assessment, a cornerstone of CSRD, only to realize they haven’t left enough time to address gaps in data collection and reporting.
During gap analysis, companies often uncover unexpected gaps in the social and environmental pillars. For example, our team recently did a gap analysis with one of Cority’s customers and found that they lacked critical compliance data on pollutants, something their sustainability team had never needed to track before. This highlights the importance of identifying data gaps early and engaging the right internal stakeholders to address any data gaps and ensure a smooth reporting process.
Alex’s advice? Start engaging cross-functional teams early and leave ample time to address gaps. Waiting until the end of the process can lead to unnecessary stress and complications.
2. Moving Beyond Compliance: Unlocking the Value of CSRD
Many companies view CSRD as a compliance exercise—akin to “eating your vegetables”. In reality, it offers far more value than just meeting regulatory requirements. Here are three key ways companies can reframe CSRD as a strategic opportunity:
- Risk Management: CSRD provides a more holistic view of a company’s risks, helping businesses identify and mitigate potential issues before they escalate.
- Improvement Opportunities: The data collected through CSRD can uncover areas for operational improvement, which companies can then leverage to enhance their sustainability performance and reputation.
- Stakeholder Alignment: Double materiality assessments often reveal disconnects between internal priorities and external stakeholder expectations. By addressing these gaps, companies can get ahead of stakeholder concerns and build stronger relationships.
European companies especially, which are further along in the CSRD process, are already framing their efforts around these benefits. This approach not only makes the process more meaningful but also helps secure the internal resources needed to execute it effectively.
3. Building a Business Case for CSRD
To secure buy-in for CSRD initiatives, it’s important to build a compelling business case. Simply presenting CSRD as a regulatory burden won’t inspire enthusiasm or secure the necessary resources. Instead, companies should focus on tangible benefits, such as improved risk management, operational efficiencies, and enhanced stakeholder trust.
By framing CSRD as an opportunity rather than an obligation, companies can shift the narrative and drive meaningful change within their organizations.
How Cority Can Support with CSRD Compliance
With Cority’s Sustainability Performance Management software and expert advisory services our customers can simplify CSRD compliance by automating data collection, ensuring accuracy, and aligning with ESRS requirements. Cority’s software centralizes ESG data, manages KPIs, and integrates with frameworks like CDP and GRI, while its emissions library supports precise metric calculations.
Cority’s 70+ ESG experts offer tailored guidance, including double materiality assessments, gap analysis, and report preparation. Together, Cority’s software and advisory services help organizations meet CSRD requirements efficiently and build a robust sustainability strategy for the future.
If you’re looking for more insights on CSRD, visit our dedicated page.
Pete May is the co-founder of Trellis Group, a network of independent consultancies specializing in sustainability, strategy, and transformation. Connect with him on LinkedIn or visit Trellis Group’s website.
