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ESG is at the heart of a new EU directive that sets requirements for the sustainability reporting of the largest companies. The directive is called the Corporate Sustainability Reporting Directive (CSRD).

What is ESG and why are the rules being introduced?

ESG is a way of structuring work with sustainability and covers the concepts of Environment, Social and Governance. In Danish, it corresponds to environment and climate, social conditions and corporate behavior.

Environment: Environmental and climate issues such as CO2 emissions, climate change and adaptation, pollution, water and marine resources, biodiversity, ecosystems and circular economy.

Social: Social conditions, e.g. working conditions for your own workforce and workers in your value chain, affected communities, consumers and end users. Areas often considered include diversity, equality and inclusion, human rights, health and safety.

Governance: Aspects of corporate behavior, such as corporate culture, whistleblower protection, anti-corruption or political engagement.

New EU directive: Corporate Sustainability Reporting Directive (CSRD)

These three concepts are at the heart of a new EU directive that sets requirements for the sustainability reporting of the largest companies. The directive is called the Corporate Sustainability Reporting Directive (CSRD).

New sustainability reporting standards (ESRS)

The directive is followed by a set of reporting standards, the so-called European Sustainability Reporting Standards (ESRS).

The standards provide a new, common framework for how companies should measure and report on sustainability.

Why is ESG being introduced?

The new rules and standards will ensure that companies in Denmark and the rest of the EU report on sustainability in the same way.

This makes it easier for investors and other stakeholders across countries and industries to understand how a company works with sustainability.

At the same time, it allows companies to document their efforts to avoid the risk of greenwashing in their communication and marketing.

Read more:

> What is ESG and why are the rules being introduced?

> Who do the rules apply to?

> What are the requirements for sustainability reporting (CSRD)?

 

 

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