Illustrasjon som viser CSRD bærekraftsrapportering for norske bedrifter

What is CSRD? Corporate Sustainability Reporting Directive

The Corporate Sustainability Reporting Directive (CSRD ) is the EU's new sustainability reporting directive that affects Norwegian companies through the EEA Agreement. The directive requires comprehensive reporting on environmental, social and corporate governance (ESG) issues and represents the most comprehensive change to sustainability reporting in Europe.

Illustration showing CSRD sustainability reporting for Norwegian companies

What is CSRD?

The Corporate Sustainability Reporting Directive (CSRD) is the EU directive that replaces the former Non-Financial Reporting Directive (NFRD). The directive entered into force on 5 January 2023 and must be implemented into Norwegian law through the EEA Agreement.

Main purpose of CSRD

CSRD has several key goals:

  • Standardize sustainability reporting across the EU/EEA
  • Increasing transparency about companies' sustainability performance
  • Support green transition and sustainable investments
  • Reducing greenwashing through stricter requirements
  • Harmonize reporting with international standards

CSRD implementation timeline for Norwegian companies

Who is covered by CSRD?

CSRD applies to Norwegian companies that meet certain criteria, with a phased introduction over several years.

Companies Covered

Category Criteria Reporting start
Large listed companies Already covered by NFRD 2025 (for 2024 data)
Large unlisted companies ≥250 employees AND (turnover >€40m OR balance sheet >€20m) 2026 (for 2025 data)
Small and medium-sized listed companies Listed, not micro-business 2027 (for 2026 data)
Third-country companies EU turnover >€150m 2029 (for 2028 data)

Norwegian Criteria

For Norwegian companies, the following threshold values ​​apply:

  • Employees: 250 or more
  • Turnover: Over 400 million NOK (approx. €40m)
  • Balance sheet total: Over 200 million NOK (approx. €20m)

The company must meet at least two of these criteria for two consecutive years .

CSRD Reporting Requirements

CSRD requires reporting within three main areas known as ESG (Environmental, Social, Governance).

ESG areas in CSRD reporting

Environment

Environmental reporting includes:

  • Climate change: Emissions, climate risk, adaptation measures
  • Pollution: Air, water, soil
  • Water and marine resources: Consumption, impact on water quality
  • Biodiversity: Impact on ecosystems
  • Circular economy: Waste management, resource use

Social conditions (Social)

Social reporting includes:

  • Own workforce: Working conditions, diversity, training
  • Value chain: Supplier labor conditions
  • Affected communities: Local communities, indigenous peoples
  • Consumers: Product safety, availability

Corporate Governance

Management reporting includes:

  • Business Ethics: Corruption, Bribery
  • Political influence: Lobbying, political contributions
  • Stakeholder relations: Dialogue, grievance mechanisms

European Sustainability Reporting Standards (ESRS)

CSRD reporting shall follow the European Sustainability Reporting Standards (ESRS) developed by EFRAG.

ESRS standards and structure

ESRS Standards

Standard Area Description
ESRS 1 General principles Basic reporting principles
ESRS 2 General information Strategy, management, risk assessment
ESRS E1-E5 Environment Climate, pollution, water, biodiversity, circular economy
ESRS S1-S4 Social conditions Workforce, value chain, society, consumers
ESRS G1 Corporate governance Business ethics and culture

Double Materiality

CSRD introduces the concept of double materiality:

  1. Financial materiality: How sustainability factors affect a company's financial performance
  2. Impact materiality: How the company affects people and the environment

Implementation in Norway

Norway must implement the CSRD through the EEA Agreement and adapt Norwegian legislation.

Legislative process

  • Accounting Act: Must be amended to include CSRD requirements
  • Securities Trading Act: Adjustments for listed companies
  • Auditors Act: Requirements for external assurance of sustainability reports

Regulatory authorities

The Financial Supervisory Authority will likely be responsible for:

  • Monitoring CSRD reporting
  • Enforcement of reporting requirements
  • Guidance for Norwegian companies

CSRD implementation in Norwegian regulations

Practical Implementation

Preparations for Businesses

Norwegian companies should start preparations early:

  1. Find out if your company is covered by the CSRD requirements
  2. Conduct materiality analysis to identify relevant topics
  3. Establish data collection systems for ESG data
  4. Develop reporting routines and internal controls
  5. Ensuring expertise in sustainability reporting
  6. Plan external backup of reports

Data Collection and Systems

Effective CSRD reporting requires:

  • Integrated systems that connect accounting data with ESG data
  • Automated data collection processes
  • Quality assurance of data and calculations
  • Documentation of methods and assumptions

Audit and Assurance

CSRD requires external assurance of sustainability reports, equivalent to an audit of the annual accounts .

Security levels

  • Limited hedging: First phase (2025-2028)
  • Affordable insurance: Planned from 2029

The Auditor's Role

Auditors must:

  • Develop expertise in sustainability reporting
  • Establish audit methodology for ESG data
  • Ensuring quality in sustainability reports
  • Report discrepancies and areas for improvement

CSRD audit and assurance process

Consequences for Norwegian Companies

Costs and Resources

CSRD implementation entails significant costs:

  • System development: 500,000 - 2,000,000 NOK
  • Skills development: 200,000 - 500,000 NOK annually
  • External insurance: 100,000 - 500,000 NOK annually
  • Ongoing operations: 1-3 full-time employees for large companies

Business opportunities

CSRD can also create opportunities:

  • Better access to capital through sustainable investments
  • Competitive advantage through transparency
  • Improved risk management and operational efficiency
  • Stronger brand and reputation

Relationship with Other Regulations

CSRD must be seen in the context of other regulations:

EU taxonomy

The EU taxonomy classifies sustainable economic activities and requires reporting on:

  • Share of revenue from taxonomy-qualified activities
  • Share of investments (CapEx) in sustainable activities
  • Proportion of operating expenses (OpEx) related to sustainability

SFDR (Sustainable Finance Disclosure Regulation)

SFDR influences financial players and their reporting on sustainability factors in investment decisions.

Relationship between CSRD and other EU legislation

Preparations and Recommendations

Action Plan for Businesses

  1. Mapping (2024):
  2. Consider whether your company is covered
  3. Identify reporting deadlines

  4. Conduct gap analysis

  5. Planning (2024-2025):

  6. Develop sustainability strategy
  7. Establish governance structure

  8. Plan system solutions

  9. Implementation (2025-2026):

  10. Implement data collection systems
  11. Develop reporting routines

  12. Securing expertise and resources

  13. Reporting (from 2025):

  14. Complete initial reporting
  15. Secure external audit
  16. Continuous improvement

Critical Success Factors

  • Management anchoring and clear responsibility
  • Interdisciplinary collaboration between accounting , sustainability and IT
  • Quality assurance of data and processes
  • Continuous competence development
  • Proactive approach to regulatory development

Future Developments

Extensions of CSRD

The EU is planning several enlargements:

  • Sector-specific standards for banking, insurance and oil/gas
  • Standards for SMEs (small and medium-sized enterprises)
  • Third country standards for non-EU companies

Digitization

Digital reporting becomes central:

  • XBRL format for structured reporting
  • Machine-readable data for automated analysis
  • Data exchange APIs

Future development of CSRD and digital reporting

Conclusion

The CSRD represents a fundamental change in how Norwegian companies must report on sustainability. The directive requires extensive preparation and significant investments, but can also create valuable business opportunities.

Key points

  • Phased introduction from 2025 to 2029
  • Comprehensive ESG reporting requirements
  • External assurance of sustainability reports
  • Significant costs but also opportunities
  • Early preparation is critical for success

Norwegian companies covered by the CSRD should start preparations immediately to ensure regulatory compliance and maximize the business opportunities that result from increased transparency and sustainability focus.

For companies that are not directly covered by CSRD, it may still be wise to follow developments, as demands from customers, investors and other stakeholders can make sustainability reporting relevant even for smaller companies.

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