Guide to the Corporate Sustainability Reporting Directive (CSRD)

Last reviewed 12 August 2026. The CSRD was amended by the Omnibus I simplification package, adopted as Directive (EU) 2026/470 on 24 February 2026 and published in the Official Journal on 18 March 2026, so any scope figure published before that date is out of date.

What is the CSRD?

The Corporate Sustainability Reporting Directive (CSRD) is Directive (EU) 2022/2464, adopted by the European Parliament and the Council on 14 December 2022. It amends the EU Accounting Directive and requires companies in its scope to publish sustainability information, including climate and value chain emissions, inside their annual management report, prepared under the European Sustainability Reporting Standards (ESRS).

Two things separate it from the Non-Financial Reporting Directive it replaced. The information sits in the management report alongside the financial statements rather than in a separate ESG document, and it has to be assured by a third party.

Its scope was narrowed in February 2026, which is the first thing to check if you are working from a CSRD guide written before then.

How does the CSRD fit with the rest of the EU's sustainability rules?

The CSRD is the reporting piece: it sets who reports and when. The ESRS set what to report. The EU Taxonomy Regulation defines which economic activities count as environmentally sustainable, and companies in CSRD scope report their taxonomy alignment alongside their ESRS disclosures. The Corporate Sustainability Due Diligence Directive (CS3D) is a separate instrument covering due diligence duties rather than reporting, and it was amended by the same Omnibus I package.

Putting sustainability data in the management report means it is handled like financial data, with the same reporting boundary and the same expectation that somebody outside the company can follow the numbers.

Who has to report under the CSRD?

After Omnibus I, the CSRD applies to companies with more than 1,000 employees and net annual turnover above €450 million. For third country undertakings, the requirements apply where the parent undertaking's net turnover in the EU is above €450 million and the subsidiary or branch generates turnover above €200 million. Those are the thresholds in Directive (EU) 2026/470, which the Council of the EU signed off on 24 February 2026.

The amending directive also exempts the wave one companies, meaning those that had to start reporting from financial year 2024, for financial years 2025 and 2026. The revised ESRS apply to financial years beginning on or after 1 January 2027, with early adoption for financial year 2026 permitted once the delegated act enters into force. Financial year 2027 is therefore the first year the amended rules cover.

Member states have one year from the directive's entry into force to transpose it, and it entered into force on the twentieth day after publication in the Official Journal. Your own start date depends on that transposition, so confirm it against the directive text and your local rules rather than any article, this one included.

What do you have to report, and who checks it?

The ESRS set the disclosures. They cover:

• Business model and strategy
• Governance, including the use of sustainability expertise
• Policies
• Due diligence
• Value chain information
• Impacts, risks and opportunities
• Action plans, metrics and targets

The European Commission published a delegated act revising the ESRS in July 2026, which simplifies and streamlines what has to be reported. ESRS E1 is still the climate standard. Scope 1, Scope 2 and Scope 3 emissions sit there, which includes emissions from the organisations you buy from and invest in.

On checking, the CSRD requires limited assurance on the sustainability statement, under Article 34 of the Accounting Directive as amended. Limited assurance means the provider reports whether anything came to their attention to suggest a material misstatement, which is a lower bar than the reasonable assurance given on financial statements. Secondary sources often describe the CSRD as requiring reasonable assurance, and that is a different and higher requirement. Omnibus I settled the question by removing the Commission's power to adopt reasonable assurance standards, and the Commission is due to adopt limited assurance standards by 1 July 2027. The work is done by a statutory auditor or, where the member state allows it, an independent assurance services provider.

Assurance providers ask where the Scope 3 numbers came from, which turns into a question about your software. Our guide to evaluating carbon software for CSRD lists the five documents to ask a vendor for before you sign.

What does double materiality mean?

Double materiality means reporting two directions of the same subject. Impact materiality is the company's effect on people and the environment. Financial materiality is how sustainability matters affect the company's own development, performance and position. A topic is reportable if it is material in either direction, not only when it is material in both.

This is why value chain emissions are hard to leave out. Climate is material for most companies that buy anything, so ESRS E1 pulls in data from other organisations, and that data has to hold up when an assurance provider looks at it. How much a reporter may require from a smaller organisation in its value chain is capped, and our post on SME emissions data under CSRD covers that cap and what to ask for instead.

How is the CSRD enforced?

Enforcement sits with member states, which set penalties and administrative measures when they transpose the directive into national law. The consequences of a late or missing sustainability statement therefore differ by country, and if you report in more than one member state your legal team will hold the local position.

Before it is a legal question it is a data one. The statement has to be traceable enough that a third-party auditor can follow how each figure was produced, which is what buyers mean when they ask whether the numbers are auditable.

What does CSRD reporting need from your supply chain data?

ESRS E1 needs Scope 3 numbers with sources an assurance provider can follow, refreshed often enough to stand up in a management report. Most of that data sits inside other companies, which is why a once a year spreadsheet exercise struggles with it.

DitchCarbon provides verified emissions data for over 2 million organisations, so procurement, sustainability and finance teams can measure and act on supply chain and portfolio emissions from one source. Every figure carries its source and change history. The DitchCarbon Portal calculator is verified to ISO 14064-3, limited assurance, by UL Solutions, renewed annually, and the emission factor methodology was independently assessed by Globus Thenken in August 2025, covering spend-based Scope 3 categories 1 and 2. A verified calculator plus provenance on every figure is what audit-ready means here, and both reports are downloadable from the trust centre.

DitchCarbon is the only specialist Scope 3 tool with third-party assurance of its calculation methodology. Every vendor checked, verified or not, is listed with its verifier and evidence in our benchmark of carbon software assurance. For third-party verified carbon software compared by category, with each vendor's verification status in one table, see our Scope 3 software comparison guide.

Whether a sustainability statement satisfies the CSRD is for you and your assurance provider to determine. What data does is get you to numbers you can defend within 2 weeks, with the provenance attached. DitchCarbon data has been used in emissions reports that were subsequently assured by ten different third-party assurance providers, including Big Four firms.

Where to go next

• Reporting under CSRD: see what coverage looks like on your own supplier or portfolio list with emissions reporting.
• Being asked for data: if a customer or an investor has asked you for emissions data for their sustainability statement, claim your company profile and answer once with figures you can reuse.