What is the role of EFRAG in CSRD?

The role of the European Financial Reporting Advisory Group (EFRAG) in the Corporate Sustainability Reporting Directive (CSRD) is significant and directly aligns with your professional focus on sustainability and strategic business advising.

About the European Financial Reporting Advisory Group.

In an era where sustainability is not just a buzzword but a business imperative, the European Financial Reporting Advisory Group (EFRAG) has emerged as a key player. For businesses seeking to align with sustainable practices, understanding EFRAG's role is good to understand. EFRAG's role is more than just setting standards; it's about being a catalyst for change. By creating a common language for sustainability reporting, EFRAG is not only guiding businesses but also influencing investment decisions. Companies that proactively adopt these standards are likely to be seen as leaders in sustainability, aligning with your vision of leading by example.

  • EFRAG has been tasked with developing draft European sustainability reporting standards under the CSRD. This is a critical role, as these standards will shape how companies across the EU report on sustainability matters. The standards are intended to provide a consistent framework for disclosure, making sustainability reports more comparable and reliable.

  • EFRAG's expertise in financial reporting is now being leveraged to incorporate sustainability aspects into corporate reporting. This involves not just environmental factors but also social and governance aspects, aligning with the broader ESG (Environmental, Social, and Governance) criteria.

  • Part of EFRAG's role involves engaging with various stakeholders, including businesses, sustainability experts, and policymakers, to ensure that the standards developed are comprehensive, practical, and reflective of the diverse needs and challenges faced by different sectors.

  • EFRAG also works towards ensuring that the European standards are aligned with global sustainability reporting frameworks. This is crucial for maintaining consistency and comparability in sustainability reporting across different jurisdictions.

  • Once the standards are developed and adopted, EFRAG's role will likely extend to helping companies understand and implement these standards, providing guidance and support to ensure effective and meaningful reporting.

EFRAG's Mission and Impact

EFRAG, established in 2001, primarily focused on providing expert advice to the European Commission on financial reporting matters. However, its role has significantly expanded. Now, it's at the forefront of developing European sustainability reporting standards, making it a pivotal organization in the sustainability landscape.

This shift aligns perfectly with the growing demand for transparency and accountability in corporate sustainability efforts. EFRAG's standards aim to provide a framework for companies to report on their sustainability activities, offering stakeholders a clear, comparable, and reliable view of their performance.

For businesses, adapting to EFRAG's standards is not just about compliance; it's a strategic move. The early adopters of these practices are likely to be the winners of the future. EFRAG's standards provide a roadmap for companies to become truly sustainable, going beyond mere claims to demonstrating real impact.

CSRD - the impact on Businesses:

For businesses the implementation of CSRD and the standards developed by EFRAG will be a significant step. Companies will need to adapt their reporting practices to meet these new requirements, focusing more on transparency and accountability in their sustainability efforts. This presents both a challenge and an opportunity to integrate sustainability more deeply into their operations and strategies, aligning with your vision of embedding sustainability as a core aspect of business DNA.

In summary, EFRAG's role in CSRD is pivotal in shaping the future of corporate sustainability reporting in Europe, offering a framework that promises greater transparency, consistency, and comparability in how businesses report their sustainability performance.

How we can help?

Our sustainability experts can support you and get you on your way.

  • CSRD & sustainability experts inhouse

  • Familiar with these standards and understand needs and requirements depending on your use case

  • Industry specific know how on newest innovations that strengthen your sustainability strategy