A few notes and recommendations in conclusion...

Tips for processing report in practice

Sufficient time allocation for the project

Whether you are solving the project internally or have an external consultant on hand, set aside enough time for the entire process. The double materiality assessment alone can take several months. We therefore recommend starting the entire project with all the necessary details at least a year in advance.

Determining responsibilities and onboarding of the team

In practice with our clients, we see differences if a company has implemented ESG as a project with set project management, or if responsibility is left to one person. The first option turns out to be a much more effective approach that not only saves time, but can also significantly reduce frustration in the company. However, before such a project gets underway, we recommend training everyone who will participate in the project. In order for all members to be willing to devote time to the project, they must know what the project specifically entails and what it is intended to bring to the company.

Early engagement of the assurance provider

As stated in the introductory part, ESG reporting will be an integral part of the company's annual report and, like financial data, will be subject to mandatory audit. In our practice, we recommend contacting the statutory auditor and discussing your preparation and approach to ESG implementation with him well in advance. It is worth getting his feedback. Above all, you will gain time to incorporate adjustments according to his expectations.

Engaging an external advisor

Involving an experienced partner can ultimately save you not only worries and time, but also money. You can consult with an advisor on individual parts or let them guide you through the entire implementation project.

News from the world of ESG legislation

Sustainability Due Diligence Directive

In the spring of last year, the European Union approved the Sustainability Due Diligence Directive, known as CSDDD or CS3D. The main purpose of the new regulation is to strengthen the responsibility of companies for the impacts in their value chains, in particular the impacts on human rights and the environment. Member States now have until June 2026 to transpose it into national law, with the first year of application a year later. You can find more information about this regulation in the detailed brochure Guide to the Corporate Sustainability Due Diligence Directive.

ESEF markup

One of the requirements of a report under the CSRD is the marking of information in a uniform electronic format (ESEF). In December last year, the ESMA authority⁽¹⁾, which is responsible for preparing the tool, published a report on the gradual implementation of XBRL markup for sustainability reports. Based on the document, it follows that the requirement for information labeling will not apply until 2026 at the earliest.

Omnibus 

In November last year, European regulators announced that they plan to merge regulations governing non-financial reporting, specifically CSRD, EU Taxonomy and CSDDD, into one consolidation package called Omnibus. The EU hopes that this step will primarily simplify reporting obligations and reduce the administrative burden for affected companies. We should learn more information in February 2025. We will keep you posted on our LinkedIn profile.

Standards for voluntary reporting by SMEs

In December 2024, the EFRAG group adopted and published an official standard for voluntary reporting by unlisted small and medium-sized enterprises (VSMEs).⁽²⁾

Are you preparing CSRD report this year? If you don't want to face this difficult task alone, Forvis Mazars is here for you. We will be happy to guide you through the entire ESG implementation process and help you ensure compliance with legislative requirements.

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⁽¹⁾ European Securities and Markets Authority

⁽²⁾ EFRAG Voluntary Sustainability Reporting Standard for non-listed SMEs https://www.efrag.org/sites/default/files/sites/webpublishing/SiteAssets/VSMEStandard.pdf

Authors:

Zuzana Rozsívalová, ESG Manager, Forvis Mazars in the Czech Republic

Tereza Sedlmajerová, ESG Senior Consultant, Forvis Mazars in the Czech Republic