The 'Corporate Sustainability Reporting Directive (CSRD)' is an EU regulation that requires large and listed companies operating in the EU to disclose detailed information about their environmental, social, and governance (ESG) impacts. But CSRD goes far beyond ESG buzzwords—it introduces legally binding rules and a unified reporting framework to make sustainability data reliable, comparable, and auditable.

While ESG stands for Environmental, Social, and Governance, and is commonly used by investors and stakeholders to evaluate corporate sustainability, CSRD is a legal obligation. ESG is a lens; CSRD is the law. More importantly, CSRD requires companies to report not just ESG performance, but a wide range of 'sustainability-related issues', including business models, climate risks, and the company’s impact on society. These disclosures must follow the 'European Sustainability Reporting Standards (ESRS)' and undergo 'third-party assurance'.

Under CSRD, companies must disclose:
1. Double materiality (how sustainability affects the business and how the business affects sustainability)
2. Detailed climate, environmental, labor, human rights, and anti-corruption metrics
3. Targets, strategies, governance structures, and policies
4. Data traceability, forward-looking metrics, and performance indicators
The reports must be digitally tagged for machine readability and published within the company’s annual management report.

A company may already be working on sustainability: reducing emissions, improving workplace equality, and engaging suppliers on social responsibility. Under traditional ESG frameworks, these efforts might be reported selectively.
However, if the company is subject to CSRD, it must follow ESRS guidelines and structure all relevant sustainability data into a formal, auditable report. This ensures the data is transparent, comparable, and verifiable—not just for investors, but for regulators, partners, and the public.

To meet CSRD requirements, companies need to:
1. Conduct a 'double materiality assessment'
2. Structure and digitize their sustainability data
3. Adopt ESG and sustainability platforms that support 'ESRS-compliant reporting'
4. Collaborate with suppliers and internal departments for traceable emissions, HR, and governance data
5. Prepare for third-party 'assurance and digital tagging'
With the right tools, CSRD compliance becomes less of a reporting burden—and more of a strategic opportunity.