CSRD & ESRS: Is biodiversity (E4) material?

Introduction

As companies work to meet the ESRS standards, the concept of double materiality is key. This means businesses need to consider both how sustainability issues impact them financially and how they impact the environment and society.

One big question many are asking: Is biodiversity (E4) going to be material for us?With the deadlines for the first CSRD reports approaching, the first studies are coming out which are giving us some early insights into how companies are tackling it.

Key Takeaways

1. 53% of DAX-40 companies will address biodiversity in their 2024 sustainability reporting (ASCG - Accounting Standards Committee of Germany)
2. 55% of early ESRS adopters see E4 as material (University of Cologne)
3. Cooley looked at 20 partially aligned reports and found that 𝟲𝟯% of them saw biodiversity as material (Cooley LLP)

Conclusion

It's becoming clear that biodiversity is a growing focus for companies under the ESRS framework. With a significant number of early adopters recognizing its materiality, businesses are increasingly acknowledging not just their impact on nature, but also how they financially depend on it.

Want to see how Leeana can help to comply with ESRS E4? Book a call today!

Sources

Müller/Valkyser (2024), CSRD Materiality Analysis – Early Adopter Insights, available at https://sustainabilityreportingnavigator.com/csrd-dma-analysis.pdf
Kurzumfrage des DRSC zum Stand der Wesentlichkeitsanalyse in den DAX40-Unternehmen, available athttps://www.drsc.de/app/uploads/2024/07/2024_07_12_Bericht-DAX40-Stand_der_Wesentlichkeitsanalyse.pdf‍
Insights From Early Adopters of EU’s Corporate Sustainability Reporting Directive, available at https://www.cooley.com/news/insight/2024/2024-08-06-insights-from-early-adopters-of-eus-corporate-sustainability-reporting-directive