Step-by-step guide to mandatory CSRD: what does it mean for my business?

There are 2 types of ESRS standards:

• 12 general ESRS standards that apply to all businesses. Such as pollution, circular economy, own staff, or business behaviour.
• Specific ESRS standards that vary by sector. Standards will be added for a number of sectors in the coming years.

Each ESRS standard consists of different reporting requirements. These in turn consist of data points. These are measurement points that you report on, such as water consumption. In total, there are about 1,100 data points that you can report on. You only have to report on the data points related to your business.

Do you have an unlisted SME company? If so, you may choose to report voluntarily. You may also face demands from customers or suppliers to comply with CSRD. By starting to collect and publish information early, you can prepare in time.

Read when mandatory reporting will be introduced step by step.

Stakeholders of your business can be:

• employees
• customers
• suppliers
• a purchasing group
• board of supervisors
• auditor
• banks
• environmental organisations
• the government

Make sure you at least engage with individuals or groups whose interests are or may be affected by your organisation's activities. Such as local residents, employees, or communities.

Discuss with your stakeholders what they consider important and what they expect from your organisation. And where they see opportunities and risks for your organisation. Also discuss which topics are important to you for the organisation. And how you arrived at those topics.

The topics you discuss with stakeholders are taken from the 12 general ESRS standards (see step 1) that apply to all companies. Examples are:

• Own employees.
• Material use and circular economy, such as company waste.
• Business behaviour, such as promoting your corporate culture.

You do not have to cover all topics (or data points). You can also add points that are important to you. Such as data reliability.

You can use questionnaires or conduct interviews. For a complete picture, it is good to speak to many stakeholders. For your business, determine what is enough and achievable. Then describe in your report how your business takes stakeholders' interests into account. For example, in your strategy and ways of working.

Find (Dutch only) information and examples for setting up your own stakeholder dialogues here:

• View 9 steps to a meaningful dialogue (PDF, in Dutch).
• Other tools, knowledge documents, and training (in Dutch) from the Social and Economic Council (SER) that help with setting up.

A double materiality assessment (DMA) is a key requirement of the CSRD. It shows the impact society has on your business (such as CO2 emissions or corruption). And it shows the impact your business has on society, the environment, and people. Such as damage to biodiversity or human rights violations. The issues that come out of the analysis are those that are most important to your organisation and stakeholders.

Read more about the ESRS guidelines for a materiality assessment. Or watch this Social and Economic Council (SER) webinar (in Dutch) on the impact of double materiality on businesses.

There are several steps to achieve a materiality assessment. And there are several guides you can use to get started with and perform your DMA:

• EFRAG has published an Implementation Guidance document that outlines why and how to set up your DMA.
• This 7-step guide from the Royal Netherlands Institute of Chartered Accountants (NBA, in Dutch) helps you make a materiality assessment.
• The Financial Markets Authority (AFM) has drawn up 10 navigation points that can support you in implementing the double materiality assessment.
• In this Social and Economic Council (SER) webinar (in Dutch), you will see how to get started with double materiality for businesses.

There are two types of data:

• Qualitative data. This is descriptive data that helps to understand the business. Such as a description of how stakeholders' interests have been taken into account.
• Quantitative data. This is data that consists of numbers. Such as the total number of employees covered by a collective labour agreement (CAO).

Look at what you already test and who is responsible for the data. Discuss how your employees provide the data.

Inform your chain partners* about the reporting obligation as soon as possible so that you can prepare together. This is often where the biggest risks and opportunities for your business lie. It is called chain responsibility. Think about strategy and how you want to have influence together. For example, on fair pay. Also discuss how to share the right data with each other. Select which buyers or suppliers you want to collect data from. Only request data from the businesses that have the most impact. And data that fit the topic you are reporting on. In this way, you will avoid additional administrative burdens. If you start by doing it yourself first, it can take a lot of time. For more tips and resources on chain responsibility, visit RVO.nl.

* see page 15 for an explanation of the impact of the CSRD on your chain partners

Some complex data you cannot measure on your own. To measure these, you can cooperate with the government and other parties. Also make use of public instruments with which you can measure data. Also ask your sector organisation for available data. The Authority Consumer & Market (ACM) has made a ‘Sustainability Claims Guide’ (in Dutch) with practical examples to help formulate sustainability claims.

Public tools you can use are:

• International RBC agreements
• CO2 emissiefactoren (in Dutch)
• CO2 footprint calculator
• Open Supply Hub

Use the same methods as for financial processes and internal control that are already in place in the organisation. Check where the data you are reporting on will come from. And how reliable that information will be. You can record this in a handbook. In it, you put, for example:

• how the data will be reported (methodology)
• where the information comes from
• who is responsible for registration and control
• which systems and processes are linked to it
• Which internal measures are in place for reliability

This is how you show your auditor how you give data reliability a place within your processes and systems. For data from your suppliers, you can do your own analysis. In it, you test for all suppliers and the data whether there are any strange discrepancies. Avoid using misleading sustainability claims.

Also watch this SER webinar on CSRD and ESRS and reliable data (in Dutch).

Some complex problems you cannot solve on your own. You can use, for example, the SER's International RBC agreements. In these, businesses work together with the government and other parties. And are supported with data collection. This allows you to take a more structured and solution-oriented approach to data collection. You can also use qualitative information. For example, you then write down what you do in a particular collaboration with suppliers. See what agreements are in place.

You may still use estimates for the first 3 years. Are you not yet (fully) sustainable? Or have you taken no action yet? Then you can write down in your report what the current situation is and where you want to grow towards. It is important that you can explain what you do not yet know. You have 3 years to report the right information.