At last, the new global framework for biodiversity is finally is in place and the EU's sustainability directive, Corporate Sustainability Reporting Directive (CSRD) was adopted by the EU Parliament in November 2022.was adopted by the EU Parliament in November 2022. This means that more and more companies will have to monitor and report their impact on biodiversity. Therefore, it is time for those covered by the directive to understand and be able to interpret your company's impact on nature.

Background

The EU Biodiversity Strategy for 2030 is a comprehensive, ambitious and long-term plan to protect nature and reverse ecosystem degradation. The strategy aims to put Europe's biodiversity on the path to recovery by 2030. To achieve this goal, the EU's sustainability reporting through the new directive, CSRD, has been revised and strengthened.The requirements are extended to all large companies and all listed companies in the EU.

Who is covered by the CSRD?

The Directive enters into force in the financial year 2023 and reporting is required:

1 January 2024 for companies already covered by the Non-Financial Reporting Directive (2025 reporting), means EU PIE i.e. >500 employees.

1 January 2025 for large companies currently not covered by the Non-Financial Reporting Directive, 250 employees 40 MEUR turnover, 20 MEUR BO.

1 January 2026 for listed SMEs, small and non-complex credit institutions and captive insurance undertakings. An exemption will be possible for SMEs during a transitional period, meaning that they will be exempt from the application of the Directive until 2028.

Non-EU companies 2028 (over 150 MEUR turnover in the EU, some information).

What is ESRS and how does it relate to biodiversity?

If CSRD is seen as the 'task' to be carried out in the context of sustainability reporting, the European Sustainability Reporting Standards (ESRS) are best explained as the 'tool' used to carry out the task. The ESRS are designed to help companies increase transparency and help specify the information to be disclosed such as environmental, social and governance issues. Biodiversity and ecosystems are specifically addressed in ESRS 4.

What happens now?

The European Commission has presented a draft ESRS which was published in June 2023. Here you can read Ecogain's comments on the Commission's proposal,