Sustainability reporting requires a strategy with specific goals and a plan for follow-up. It is important that sustainability is anchored and built from within your company.
InMyShoe uses the recommendations from the EU's new directive where companies must account for a sustainability strategy with specific goals and a way of measuring progress. It must be reported in three fields: Environmental, Social and Governance - i.e. ESG. Relevance and risk must also be included, and the content must be quality assured. These 5 steps can be a useful tool in the process:
Step 1. Map: Assemble a group and map what kind of impact the company has socially and environmentally and choose what is most relevant. This is a materiality assessment, and the UN's 17 sustainability goals are a good checklist. Based on what one arrives at, a concrete sustainability plan is prepared with goals and time frame.
Step 2. Test: The plan must be checked with stakeholders. Do suppliers, customers, investors etc. agree, and do they have any input? Revise the plan.
Step 3. Launch: The plan must be made known across the organization and worked according to. Use web pages and intercommunication tools to bring this out.
Step 4. Implementations: The progress must be followed up. How is it working? Do we keep the plan? If not, why not?
Step 5. Reports: The results are presented in relation to the goals that have been set. Transparency is key; what have we achieved, what did not work and what can we learn from it? There is a need for both internal and external training for follow-up of CSRD.
5 step model by: Caroline D Ditlev-Simonsen
The EU's Corporate Sustainability Reporting Directive (CSRD) has recently been presented. It is a big step towards integrating sustainability into the company’s daily operations. Although CSRD basically only applies to larger companies, and it so far does not cover most small and medium-sized companies, it will have a major impact on all companies.
The new directive requires reporting, but also requires that the company has a strategy with specific goals and a plan for follow-up in advance. The CSRD is an initiative for the revision of the current Non-Financial Reporting Directive (NFRD), i.e. the directive that does not consider corporate social responsibility reporting to be related to financial matters.
With the transition to a Corporate Sustainability Reporting Directive, which will apply to many more companies than the NFRD, it is confirmed that sustainability has to do with profitability. This is something that both companies and society will benefit from in the long run.