Corporate Sustainability Reporting Directive Will Apply to Public and Private Companies, Including Many Non-EU Companies
SUMMARY
The European Union has finalized the Corporate Sustainability Reporting Directive (“CSRD”) that will introduce more detailed sustainability reporting requirements for EU companies, non-EU companies meeting certain thresholds for net turnover in the EU and companies with securities listed on a regulated EU market. The CSRD entered into force on January 5, 2023 and is substantially consistent with the provisional version published in June 2022.
The rules will be phased in starting from January 1, 2024 for certain large EU and EU-listed companies, and will apply to all in-scope companies by January 1, 2028.
As CSRD reporting is phased in, EU subsidiaries of non-EU parents may be required to begin reporting under the CSRD before their non-EU parent comes in scope, and the CSRD includes transitional provisions on how EU subsidiaries of non-EU groups should prepare reporting before the non-EU parent provides its own CSRD reporting.
