The Fidugius Accounting & Reporting Manual assists companies to ensure their ESG reporting is reliable as it shows the company’s material ESG topics, its kpi’s, the framework in place, how to maintain accurate records by following the accounting treatments and informs on the appropriate policies. It helps to train and educate new staff members and is a reference for your auditors.

CSRD and the toolkit Fidugius

The importance of CSRD

The Corporate Sustainability Reporting Directive (CSRD) is a new EU regulation that requires companies to report on their sustainability performance. The CSRD replaces the current Non-Financial Reporting Directive (NFRD) and is part of the EU’s Sustainable Finance Action Plan, which aims to promote sustainable investment and ensure that capital flows towards sustainable activities. All large EU-listed companies will be required to report on ESG as of 1 January 2024 in accordance with the Corporate Sustainability Reporting Directive. Large companies will have to comply from 2025 and from 2026, small and medium-sized EU-listed companies will have to adhere to the directive.

The concept of the CSRD

The CSRD requires the use of the European Sustainability Reporting Standards as a reporting system for sustainability reporting. The ESRS will be prepared by the European Financial Reporting Advisory Group (EFRAG).

The following six concepts have been defined by EFRAG to realise sustainability reporting operationalised through conceptual guidelines.

  • Double materiality. This provides criteria for determining which sustainability information should be included in the company’s report. “Double” refers to both the potential financial impact on the company as a result of sustainability risks and opportunities (outside in or financial materiality), and the impact of the company on people and the planet (inside out or impact materiality);
  • Quality of information: Defines the necessary characteristics of reported sustainability information, namely: (i) relevance, (ii) faithful representation, (iii) comparability, (iv) understandability and (v)reliability/verifiability;
  • Levels and boundaries of reporting: Double materiality should be applied to different levels of reporting. The financial materiality of a sustainability matter is not constrained to matters that are within the control of the reporting entity. Likewise, the materiality of an entity’s impact on a sustainability matter is not limited to matters within the direct control of a reporting entity;
  • Connectivity. All dimensions of corporate reporting (sustainability and financial) need to be connected under an integrated approach;
  • Retrospective and forward-looking information: Assessing sustainability targets and indicators and progress towards achieving them;
  • Public good: Providing the required standards for alignment and consistency between EU reporting standards and public policy agreements, goals, frameworks and regulations.

The architecture of sustainability reporting

The sustainability reporting architecture is based on:

  • Three layers of reporting: sector-agnostic, sector-specific and entity-specific;
  • Three reporting areas: strategy, implementation and performance measurement;
  • Three topics: Environmental, Social and Governance.

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ESRS guidelines

The ESRS drafts the following sustainability topics to report on:

Cross-cutting standards:
  • Draft ESRS 1 General requirements
  • Draft ESRS 2 General disclosures
Topical standards:


  • Draft ESRS E1 Climate change
  • Draft ESRS E2 Pollution
  • Draft ESRS E3 Water and marine resources
  • Draft ESRS E4 Biodiversity and ecosystems
  • Draft ESRS E5 Resources and circular economy
  • Draft ESRS S1 Own workforce
  • Draft ESRS S2 Workers in the value chain
  • Draft ESRS S3 Affected communities
  • Draft ESRS S4 Customers and end-users
  • Draft ESRS G1 Business conduct

How to report?

The CSRD requires companies to prepare their report in XHTML format (ESEF Regulation), as the reported information must be easily accessible to investors and other stakeholders in the European Single Access Point (ESAP) database. Therefore, companies are required to ‘tag’ their reported sustainability information according to a new digital categorisation system.

ESG has to be reported on in the management report rather than in a separate sustainability report. As a result, financial and sustainability information will be disclosed at the same time.

Compliance with the GRI Framework

Reporting on ESG in accordance with the CSRD is nearby. In addition, the CSRD requires limited assurance to be provided on the ESG information reported by the company. To ensure reporting on ESG is on time and accurate, the following should be considered:

  • Understand the requirements: Companies must first understand the requirements of the CSRD and how they will affect their business. This involves analysing the proposed reporting requirements and identifying areas where additional data or disclosures may be required.
  • Conduct an ESG materiality assessment: Companies should conduct an ESG materiality assessment to identify the sustainability issues that are most relevant to their business and stakeholders.
  • ESG information system: Companies need to collect environmental data on the products they purchase (product Life Cycle Assessments) and feed this into their own measurements. All this reporting and data collection needs to be robust, transparent and verifiable.
  • Establish internal reporting systems: Companies need to establish internal reporting systems to gather and manage the data required for CSRD reporting. These systems must be able to generate accurate and reliable data in a consistent format and ensure data privacy and security.
  • Engage with stakeholders: Companies must engage with their stakeholders to understand their expectations and gather feedback on their sustainability performance. This feedback can be used to identify areas for improvement and to inform the sustainability information that is included in their annual reports.
  • Develop reporting protocols: Companies should develop protocols for reporting sustainability information in accordance with the CSRD requirements. These protocols should include processes for gathering, validating, and reporting data, as well as procedures for ensuring compliance with reporting deadlines and other regulatory requirements.
  • Set up an ESG accounting & reporting manual: A manual provides guidance and instructions for the collection, analysis, and reporting of ESG data and ensures that the reporting process is consistent, transparent and auditable. All employees are informed of the requirements and can be held accountable.
  • Monitor and report on progress: Companies must monitor their progress in meeting the CSRD requirements and report on their sustainability performance in their annual reports. This includes reporting on their sustainability strategy, governance, and risk management, as well as their performance against relevant sustainability metrics and targets.

The Fidugius soltion and CSRD

The Fidugius Accounting & Reporting Manual assists companies to ensure their ESG reporting is reliable, as it shows the company’s material ESG topics, its kpi’s, the framework in place, how to maintain accurate records by following the accounting treatments and informs on the appropriate policies. It helps to train and educate new staff members and is a reference for your auditors.

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