Understanding the CSRD and Preparing Your Sustainability Report
Published in the Official Journal of the EU on December 16, 2022, subsequently transposed into French law on December 6, 2023, and revised in December 2025, the European Corporate Sustainability Reporting Directive (CSRD) consolidates, strengthens, and harmonizes non-financial reporting through 12 European Sustainability Reporting Standards (ESRS) developed by the European Financial Reporting Advisory Group (EFRAG).
What is the CSRD directive?
Published in the Official Journal of the EU on December 16, 2022, subsequently transposed into French law on December 6, 2023, and revised in December 2025, the European Corporate Sustainability Reporting Directive (CSRD) consolidates, strengthens, and harmonizes non-financial reporting through 12 European Sustainability Reporting Standards (ESRS) developed by the European Financial Reporting Advisory Group (EFRAG).
Before it was incorporated into a European omnibus bill in 2025, the text stipulated that, starting in 2025 and following a phased implementation schedule through 2028, nearly 50,000 companies in the EU would publish an annual non-financial report on their CSR impacts, risks, and opportunities based on the principle of double materiality: the environment’s impact on the company (outside-in), and the company’s impact on its environment (inside-out). This report must be verified by an authorized external body: an auditor, a certified public accountant, a lawyer, or a certification body.
In its final version, completed in late 2025 and expected to be published in the Official Journal of the European Union (OJEU) in 2026 for transposition within twelve months by Member States, the revised directive applies only to companies with more than 1,000 employees and €450 million in revenue, with a phased implementation schedule: a first report is expected in 2028 covering the 2027 fiscal year. With the thresholds of 500 and 250 employees (for SMEs) having been eliminated, the total number of affected companies drops from 50,000 to 9,000 in Europe. The framework of mandatory indicators remains the ESRS, but in a simplified version that eliminates two-thirds of the data points. To recognize the work already done and stay in the loop, smaller companies will still be able to participate on a voluntary basis, using a streamlined framework known as the VSME (Voluntary Standard for non-listed SMEs), which was originally designed for this purpose. Historical CSR frameworks, starting with ISO 26000—adopted by more than 100 countries—constitute, more than ever, excellent springboards for those moving in that direction.
Until now, the requirement for companies to report on non-financial matters was governed by the 2014 Non-Financial Reporting Directive (NFRD). However, it left companies free to choose which indicators they wanted to report on.
Benefits of this new framework with standardized indicators
- year-over-year comparability
- comparability across companies
- comparability across sectors
- encouragement to continuously improve
- a perspective that is at once retrospective, present-day, and forward-looking
- Ensuring the credibility of information and combating greenwashing
Sustainability Report: How Can It Be Made a True Corporate Initiative?
The sustainability report is based on reliable and robust ESG data. Maintaining the quality of this data over time is therefore essential. The definition, generation, and collection of data are cross-functional processes that involve numerous stakeholders both within and outside the organization. The buy-in and understanding of the employees and stakeholders most directly affected are therefore essential!
Developing a sustainability report is a major corporate initiative. Establishing a dedicated governance structure, supported by the executive committee and led by representatives from each department, makes the process collaborative and meaningful. Training on CSRD issues strengthens the leadership of executive committees and boards of directors, while training steering committee members equips them to produce the sustainability report, either independently or with external support.
Sustainability Report: How to Create One?
From stakeholder mapping to double materiality analysis
The sustainability report requires comprehensive, methodologically sound, and well-documented preliminary work (ESRS 2), which must be incorporated into the final deliverable. The purpose of this step is to assess which sustainability issues are important and relevant, and to collectively identify which of these should be prioritized.
These are:
- Describe the business model
- Mapping the value chain and sphere of influence
- Mapping the company's stakeholders
- Identify and compile a list of potential ESG and financial impacts
- Assess ESG and financial impacts
- Reconstruct the dual materiality matrix
- Explain the analysis performed and its results (this is the explanatory task required by ESRS 2)
It is the ongoing decryptions analysis between the materiality indicators you already have and those required by the CSRD that will help you assess how much work remains to be done to comply with the CSRD’s requirements.
Comply with ESRS E, ESRS S, and ESRS G standards
The voluntary ISO 26000 standard is the international benchmark for CSR and has numerous links to the ESG criteria outlined in the CSRD. It provides a framework for understanding CSR through seven key questions (known as “pillars”) and serves as an important foundation for applying the various ESG criteria. The table below summarizes these thematic links.
Theme | Relevant ESRS standards |
|---|---|
| Communities and local development | ESRS S3 Affected Communities |
| Consumer-related questions | ESRS S4 Users and End Consumers |
| Environment | ESRS E1 Climate ESRS E2 Pollution ESRS E3 Water and Marine Resources ESRS E4 Biodiversity and Ecosystems ESRS E5 Resource Use and the Circular Economy |
| Fairness of practices | ESRS S2 Workers in the value chain ESRS G1 Business conduct |
| Governance | ESRS 2 General Information, ESRS G1 Conduct of Business |
| Human rights | ESRS S1 Company-owned workforce, ESRS S2 Value chain workers, ESRS S3 Affected communities |
| Relationships and working conditions | ESRS S1 Company-owned workforce, ESRS S2 Workers in the value chain |
Sustainability Report: Go It Alone or Get Help?
Depending on the size of your organization and its level of maturity regarding CSR issues, you may choose to prepare your sustainability report on your own or with the assistance of a consultant.
If you choose not to engage an external consultant, we recommend that you undergo training. AFNOR Compétences offers training courses on the CSRD and the challenges of non-financial reporting tailored to your organization, while AFNOR Editions has developed interactive learning paths that enable you to quickly grasp the subject through digital content and concrete examples of how it is applied.
Why should you rely on an expert within your organization?
If you decide to work with an external expert, what can you expect?
If you would like to hire a consultant, AFNOR Compétences will offer you a customized support program .
If you’d rather bring in a new team member and add them to your staff without having to handle the administrative and payroll aspects, AFNOR Word of Mouth will be able to find the right candidate for you.
On Methodology and Collective Intelligence
The consultant specializing in your industry leads group workshops at every stage of the report’s development. Their objectives are to facilitate sharing, discussion, and co-creation; identify and highlight best practices; pinpoint relevant documented information; and implement the necessary actions to support the company’s strategy and optimize the reporting process.
Coordination and ongoing dialogue
He discusses the expected outcomes of the initiative with the CSRD project team to validate the links established between improved CSR performance and the organization’s strategic priorities across financial, commercial, operational, and innovation dimensions. He maintains ongoing communication to ensure that the organization stays on track.
Deliverables
Depending on the scope, they can provide you with the content of your sustainability report or preliminary materials such as a double materiality analysis and various mappings (stakeholders, risks, etc.).
Sustainability Report: Have it verified by an independent third-party organization
In France, the CSRD regulatory framework requires covered companies to have their sustainability report verified by an independent third party selected from among several categories: statutory auditors, certified public accountants, certification bodies, or attorneys. The verification of the financial report and the verification of the sustainability report may be entrusted to a single entity or to multiple entities (the principle of co-assurance). Regardless of the choice, the selected party must have completed a mandatory 90-hour training program approved by the High Authority for Auditing (H2A) to become a sustainability auditor.
- For companies with more than 1,000 employees that are subject to these requirements, AFNOR Certification is your partner for conducting an audit of your mandatory sustainability report in accordance with ESRS standards
- For non-regulated SMEs, AFNOR Certification is your partner for conducting the voluntary sustainability audit based on VSME standards
Why choose a certification body?
- Certification bodies are experts in management systems. From strategy to on-the-ground implementation, they have a comprehensive understanding of both the roles of senior management and more operational departments, as well as how these roles interact. This holistic perspective allows for a better assessment of the non-financial quality of the responses to ESRS standards in the sustainability report.
- Certification bodies have practical experience with CSR and know how to effectively assess ESG data. This is particularly true when it comes to the QSE (quality, safety, environment) scope: proficiency in the voluntary standards ISO 9001 (quality), ISO 14001 (environment), and ISO 45001 (occupational health and safety) is therefore a plus.
- Certification bodies have sector-specific specializations. Materiality issues vary depending on whether the sector is automotive or bancassurance. Drawing on their long-standing experience as third-party auditors in the nuclear, agri-food, healthcare, and responsible finance sectors, among others, certification bodies have a roster of auditors specialized by industry.
How is the sustainability report audited?
Pre-commitment
Analysis of client needs and familiarization with the company
Commitment and Planning
Scope definition, signing of the engagement letter, development of the audit plan
Completion of the assignment
Review of reporting processes, on-site and remote audits
Finalization
Review of the work and issuance of the limited insurance certificate
Become a sustainability report auditor
Society is counting on them. Their mission will be significant, and so will their responsibility! Through their work verifying sustainability reports, sustainability auditors will lend credibility and instill confidence in non-financial data and, ultimately, in organizations’ transition plans.
Are you interested in becoming a sustainability report auditor? AFNOR Compétences, in collaboration with Apave, has developed a 90-hour training module, which has been accredited by the High Authority for Auditing (H2A, formerly H3C) since April 23, 2024. Completing an accredited training program is a prerequisite for registering as a sustainability auditor with the H2A and practicing this new profession, which lies at the intersection of CSR assessment and the world of finance.
Guidelines
The High Audit Authority has published guidelines regarding the assurance engagement on sustainability-related disclosures and taxonomy-related disclosures provided for in Article 8 of Regulation (EU) 2020/852. These guidelines assist auditors in carrying out their engagement.
