A European Directive, like the CSRD, must be implemented as precisely as possible in the laws of member states to ensure comparability. However, Directives often include several member state options, allowing states some flexibility within the framework. The CSRD includes such options, for example:

The specifics of how the CSRD will be implemented in Dutch law are still being determined. The Ministry of Finance and the Ministry of Justice and Safety are currently working on this process, with a deadline of July 2024.

While Dutch lawmakers cannot alter the content of the CSRD or the European Sustainability Reporting Standards (ESRS), they do have the authority to add additional requirements to national laws related to the CSRD. However, it is anticipated that Dutch lawmakers will implement the CSRD rules as they are, without introducing additional requirements.

According to theImplementatiebesluit richtlijn duurzaamheidsrapportering - a report published by the Dutch Ministry of Finance on November 20th, 2023 - a preliminary assessment outlines the mandatory regulations. Stakeholders, including accountants, were invited to provide feedback until December 18th, 2023.

Paragraph 4 of section 5 specifies that reports must be written in Dutch, French, German or English.

The sustainability report provides insights into the sustainability risks and opportunities of the undertaking. It is primarily intended for financial stakeholders, such as shareholders, banks, creditors, and other financiers.

Additionally, a broader group of affected users and stakeholders focus on the company's societal and environmental impact. This group includes employees, unions, customers, local residents, societal interest groups, and NGOs concerned with the environment and human rights.

The disclosures are also valuable to other parties, such as business partners, governments, and analysts and academics with an interest in sustainability reporting.

The primary purpose of annual reporting is to provide insight into the performance of an undertaking or a consolidated undertaking. However, there are exceptions to this requirement.

Many undertakings are part of a group. To reduce the administrative burden within a group, it is possible to be exempted from the reporting obligation under conditions applicable to group undertakings. In such cases, the sustainability information must be included in the consolidated report of the parent company of the group.

Exempted undertakings need to reference the consolidated sustainability report of the parent company in their annual report. This report must contain the sustainability information of the entire group.

This exemption is comparable to the exemptions for financial statements. By including sustainability information in the parent company's report, users of this information gain access to insights about the entire group.

In April 2021, the European Commission presented a proposal for the Corporate Sustainability Reporting Directive (CSRD). The European Parliament adopted the CSRD on November 10, 2022. Following its approval by the European Council, the CSRD was published in the Official Journal on December 14, 2022.

The CSRD entered into force on January 5, 2023, marking the beginning of the implementation period. National legislators now have 18 months to transpose the CSRD into national law. This period will end on the 30th of June.

It is estimated that around 50,000 undertakings in the European Union will fall within the scope of the CSRD. This represents a significant increase compared to the 11,000 undertakings currently operating under the Non-Financial Reporting Directive (NFRD), who are already required to publish a 'non-financial statement' in their management report.

The exact number of undertakings is difficult to determine, as certain exemptions may apply and the final implementation of the CSRD in national law can influence the scope.

The sustainability report should be included as a recognizable section of the management report. This report, containing the sustainability information, must be submitted annually to the Chamber of Commerce (KvK) and will likely need to be available online.

Undertakings are required to provide the information in a digital format and deposit the sustainability report in XBRL format. The information must be tagged, meaning it should be labeled in a way that allows it to be automatically read by machines (algorithms) and processed. Coolset’s report export functionality automatically generates a XBRL-readable report.

Currently, a central European Single Access Point (ESAP) is being developed. This aims to ensure stakeholders have easy access to public financial and sustainability information on European undertakings.

Yes, the sustainability report must be assessed by an external assurance provider. This may be the external auditor who also audits the financial statements, or it could be another external accountant. It is still unclear whether assurance providers other than external accountants will soon be able to assess the sustainability report. This decision will be made by individual Member States and will become clear once the CSRD is implemented in national law (June 30th, 2024 latest).

The minimum requirement for the external assessment of the sustainability report, known as 'limited assurance,' is less thorough than the 'reasonable assurance' required for financial statement audits. However, the assessment of the sustainability report will be more extensive than the current effort required for external auditors to assess the management report.

Under the CSRD, companies are currently subject to limited assurance until October 1, 2028. By this time, the EU will have drafted reasonable assurance requirements, provided it is feasible for auditors within sustainability reporting. Until October 1, 2026, limited assurance can be guided by national assurance requirements, meaning there will be no harmonization. After this date, the EU will have established EU-wide limited assurance standards.

The CSRD outlines three options for providing assurance on sustainability reporting:

Since the third option is a Member State decision, it is not yet clear if this will be permitted under Dutch law.

No, there is no minimum or maximum number of material sustainability matters required by the ESRS. Materiality is a principles-based concept and is determined based on the undertaking’s specific facts and circumstances.

The ESRS provides non-authoritative guidance on how to conduct a materiality assessment. The materiality of a sustainability matter for an undertaking depends on factors such as its strategy, business model, own operations, and value chain. Based on these specific facts and circumstances, a number of material impacts, risks, and opportunities will be identified through the materiality assessment.