Corporate Sustainability Reporting: A Real Green Deal

The European Union’s Corporate Sustainability Reporting Directive (“CSRD”) is a central piece in the cascade of regulation put in place to operationalise the European Green Deal, articulating with the EU Taxonomy Regulation and setting a new paradigm as regards to reporting obligations applicable to corporations operating in Europe, including foreign companies. The fundamental role of finance as a driver for sustainability is why the EU triggered this procedure by enacting the Sustainable Finance Disclosure Regulation (“SFDR”) setting the scene for the legal frameworks that followed and some that are yet to come. The role of technology has also not been forgotten as an important enabler for transparency and comparability of the data provided. The double materiality approach followed by the CSRD, works as a major enabler for companies to comprehensively assess, understand and use ESG factors in setting their corporate strategies. Finally, the importance of incorporating human rights in the strategy, policies and relevant internal decision-making processes of the company is also of paramount relevance to the success of the business, in particular in the selection and performance assessment of suppliers, the acquisition of companies or sale/closure of industrial units or investment projects in infrastructure in developing countries. Companies should take a holistic approach to this novel legal framework to effectively tackle and manage their ESG risks while making the