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Sustainability services: ESG, CSRD and Taxonomy
Recent developments in Dutch and European regulations demonstrate a growing focus on sustainability and corporate social responsibility. This shift stems from the increasing desire of both government agencies and stakeholders to integrate non-financial aspects into mandatory corporate reporting. These reports are critical for companies seeking to attract investors or financing. As these values increase in relevance, so do the associated regulations. The Environmental, Social, and Governance (ESG) framework provides companies with a structured approach to reporting in these areas. But what exactly does it entail, what rules apply and to whom do they apply?
ESG
Stakeholders today evaluate companies more critically based on sustainability, social commitment and governance values. As ESG values weigh more and more heavily in their decision-making, there is a growing need for reliable and verifiable information. This has led to an increase in regulations that clearly define reporting requirements regarding Environmental, Social and Governance values. ESG values are defined as follows:
Environmental: This includes an organization’s environmental impacts, such as climate change, greenhouse gas emissions, biodiversity loss and energy efficiency.
Social (Society): This covers social conditions and influences, such as employee safety, health and the organization’s impact on stakeholders.
Governance: This relates to an organization’s governance and decision-making processes. It includes measures against corruption, privacy and transparency of remuneration, among others.
Despite various reporting standards, there is no universal policy, which makes determining the right format for ESG reporting sometimes challenging. In this article, we focus on a new development within ESG: the Corporate Sustainability Reporting Directive (CSRD).
CSRD
The CSRD replaces the current EU directive for reporting non-financial information for a select group of large companies. This directive requires “large companies” to report and verify non-financial performance starting in financial year 2024. The basis for this reporting is the European Sustainability Reporting Standards (ESRS). In essence, the CSRD requires reporting on:
Business model, policy and strategy, including resilience and implementation of sustainability initiatives.
Time-bound sustainability targets.
The role of governance bodies on sustainability.
Taxonomy
The EU Taxonomy is a system that evaluates sustainability for economic activities of companies, such as buying, renting and manufacturing. Large companies and financial institutions must report on this and make this information public. This enables investors to make more conscious choices for truly sustainable funds. The EU Taxonomy covers the full breadth of the economy, including agriculture, energy, and industry, including construction and real estate.
Provisional Do-No-Significant-Harm (DNSH) criteria real estate
Click here for the provisional DNSH criteria Real Estate
Preliminary criteria green buildings
Click here for the provisional Green building criteria Real Estat
What to choose to do sustainable?
Despite the administrative burden, ESG reporting offers attractive benefits. It attracts investors, customers and employees and offers insight into cost savings. Although companies are currently allowed to choose the form of their ESG reporting, they are advised to follow CSRD standards. These will become mandatory for large companies starting in fiscal year 2024. Taking these guidelines seriously is essential given the growing role of ESG in business operations and possible future changes in director liability. At a time when sustainability and responsibility are gaining traction, adhering to ESG guidelines is not only good for the company, but also for the well-being of our planet and society.
Building Revolution is specialist in sustainability: Mail us at info@buildingrevolution.nl
Contact us:info@buildingrevolution.nl
Advantages BREEAM
A building with BREEAM has many different benefits.
- Different buildings can now be compared
- Actively driving continuous improvement
- In many cases, subsidies or tax deductions are available
- The workplace is more attractive to employees
- A lot of gas and electricity is saved
- Corporate sustainability is a must to the outside world
