The study, which involved 1,000 IT and data executives in the UK and France, indicates that while two-thirds of the organisations surveyed (65%) aim to prepare for audits and adhere to upcoming reporting deadlines within a year, one-fourth of them (25%) currently doubt the accuracy and dependability of their ESG information.
Less than one-third (27%) are confident in their existing data management capabilities to fulfil the stringent reporting criteria.
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Furthermore, approximately one-third of the firms (31%) have adopted a cautious strategy towards compliance due to ongoing ambiguities in the guidelines. This cautiousness persists amid speculations that the EU may introduce a more streamlined set of sustainability regulations by February 2025.
The study also delved into who within the companies holds responsibility for CSRD compliance. Results showed that 68% believe senior data officials, such as chief data officers (CDOs) and chief information officers (CIOs), are crucial in this process.
This underscores an evolving role for IT departments in consolidating extensive data for reports critical to stakeholders assessing a company’s sustainability credentials and risks.
In contrast, only 54% identified senior sustainability officers as accountable for compliance. Notably, just one-third acknowledged their chief financial officer (CFO’s) involvement, despite the significant financial implications of regulatory shifts.
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By GlobalDataTo improve audit readiness for CSRD reporting, over two-thirds of 68% of businesses intend to dedicate more than 10% of their yearly IT budgets to this area, with 26% allocating over 20%.
While readiness appears lacking, Semarchy suggests that mastering fundamental data management could streamline and automate the CSRD compliance process. The survey found that 89% of companies have been gathering ESG data for at least a year, with 58% doing so for over three years.
Semarchy EMEA global sales & global manager SVP Hervé Chapron said: “With regulatory uncertainty and rising expectations around sustainability reporting, many organisations view compliance as a significant hurdle. The challenge isn’t always a lack of data — it’s often about ensuring its reliability and trustworthiness.
“Fortunately, solving this doesn’t demand excessive IT spending or technical sprawl. Most companies already collect the data they need for CSRD compliance; adopting centralised, scalable tools allows them to meet regulatory and business deadlines with minimal disruption.
“Organisations must shift their perspective on compliance and reporting. Rather than viewing it as a complex burden, businesses can leverage the centralised data for better decision-making and create long-term value. Simplified data management turns audit-readiness into a strategic advantage.”
Background of the CSRD regulation
The EU is proposing reforms under its Green Deal to reduce the reporting burden on businesses. The Omnibus Simplification Package aims to cut reporting requirements by 25% for all businesses and 45% for small to medium-sized enterprises (SMEs).
This initiative will focus on the EU Taxonomy, Corporate Sustainability Reporting Directive (CSRD), and Corporate Sustainability Due Diligence Directive (CSDDD), potentially reshaping ESG and sustainability reporting.
The CSRD came into effect on 5 January 2023. It updates and enhances the regulations related to the social and environmental data that companies are required to report.
Recently, it was reported the French Government might consider proposing a comprehensive deregulation strategy, which includes an indefinite suspension of the CSDDD enforcement and challenges significant portions of the directive.
