CtrlPrint Sustainability Glossary

Navigate the evolving landscape of sustainability and discover essential terms and concepts to stay ahead in sustainable reporting and compliance.

Sustainability ReportsCSRD

Glossary of key concepts and terms

A

Article 8 - Article 8 is a part of the EU taxonomy for sustainable activities, Transparency of undertakings in non-financial statements. The aim of Article 8 is to increase transparency and help prevent greenwashing by supplying investors with data regarding the environmental impact of assets and the economic operations of both financial and non-financial entities. This measure also seeks to expand the scope of green finance by enhancing transparency of companies' environmental performance and motivating participants in financial markets to craft financial products and portfolios based on these disclosures.

C

CDP - Carbon Disclosure Project is a not-for-profit organisation that operates the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts. It was established in 2000 to encourage organisations to disclose their climate change impacts and has since broadened the scope of environmental disclosure to include deforestation and water security, and also expanded to cover all planetary boundaries.

CSR - Corporate Social Responsibility refers to a company's commitment, plans and actions to operate in an ethical and responsible manner, taking into account its impact on society and the environment. It involves integrating social and environmental concerns and concrete actions into business operations and interactions with its stakeholders.

CSRD - The Corporate Sustainability Reporting Directive, implemented by the European Union, requires all large companies and all listed companies (except listed micro-enterprises) to disclose information on what they see as the risks and opportunities arising from social and environmental issues. The directive will be phased in and smaller companies will follow suit in the coming years. CSRD will make it mandatory for around 50,000 companies operating in the EU to adhere to a new set of sustainability reporting requirements, the ESRS (European Sustainability Reporting Standard).

CSDDD - The Corporate Sustainability Due Diligence Directive is a proposed EU law mandating companies to conduct due diligence to prevent adverse environmental and human rights impacts in their operations and value chains. Compliance includes identifying and addressing potential impacts, with penalties for non-compliance. The directive also requires companies to adopt climate transition plans, aligning with EU sustainability standards.

D

DNSH - The Do No Significant Harm principle is a guideline used in sustainability to manage conflicting goals. It emphasises that measures and actions should contribute to achieving sustainability objectives without causing adverse impacts on other sustainability targets. This principle promotes balanced decision-making to ensure overall progress towards sustainable outcomes.

DMA - The Double Materiality Assessment is an analysis every company needs to perform as a part of their sustainability reporting. It evaluates the impact a company’s operations has in terms of environmental, social, and governance (ESG) factors as well as a company's financial performance. This assessment helps companies identify material issues that need to be included in the sustainability report.

E

EFRAG - The European Financial Reporting Advisory Group is an independent organisation established to provide expertise on financial reporting matters within the European Union. EFRAG's primary role is to advise the European Commission on the adoption of International Financial Reporting Standards (IFRS) into EU law.

In 2022, EFRAG expanded its scope within the Corporate Sustainability Reporting Directive to offer Technical Advice to the European Commission and deliver a fully developed draft EU Sustainability Reporting Standards (ESRS).

ESAP - European Single Access Point is a regulation, effective from July 10, 2027. The objective is to consolidate and simplify access to financial, capital market, and sustainability information via a centralised platform for EU-listed companies.

ESEF - European Single Electronic Format is a regulatory framework for the digital reporting of annual financial reports. It is mandated by the European Commission and supervised by European Securities and Markets Authority (ESMA). It requires public companies in the EU to prepare their financial reports in a standardised electronic format using eXtensible Business Reporting Language (XBRL) to enhance transparency and comparability across the European market.

ESMA - The European Securities and Markets Authority is an independent EU agency responsible for maintaining the stability and integrity of financial markets across the European Union. ESMA plays a key role in overseeing and implementing the European Sustainability Reporting Standards (ESRS) digital standard and in promoting transparency and consistency in sustainability disclosure.

ESRS - The European Sustainability Reporting Standards are a set of guidelines developed to facilitate consistent and comparable sustainability reporting that companies subjected to CSRD are required to follow.

ESRS XBRL Taxonomy - The ESRS XBRL Taxonomy converts the ESRS standards into a digital format using XBRL (eXtensible Business Reporting Language). This helps companies organise their sustainability reports more effectively.

ESG - Environmental, Social, and Governance are criterias used to assess a company's sustainability and ethical performance.

G

GRI - The Global Reporting Initiative is an international independent organisation focused on helping businesses, governments, and other entities understand and communicate their impacts on important sustainability issues like climate change, human rights, and corruption. GRI offers a universal language for organisations to express these impacts, promoting accountability and transparency.

I

IRO - Impact, Risk, and Opportunities is a framework used by organisations as part of their double materiality assessment to evaluate sustainability factors.

ISSB - ISSB Standards are sustainability reporting guidelines developed by the International Sustainability Standards Board to establish a global framework. They provide clear reporting requirements for all companies, aiming to meet the needs of global capital markets and empower investors with comparable data. These standards are designed to be interoperable with the European Sustainability Reporting Standards (ESRS), ensuring consistency and comparability in sustainability reporting globally.

N

NFRD - The EU directive Non-Financial Reporting Directive was introduced in 2014, and mandated certain large companies (with more than 500 employees) to disclose Environmental, Social, and Governance (ESG) information to enhance accountability. The Corporate Sustainability Reporting Directive (CSRD) expands and enhances this mandate.

P

PAT - As a part of the ESRS framework, Policies, Actions, Targets and Metrics are used by organisations to outline their sustainability strategies. It includes setting policies, detailing actions to achieve those policies, establishing specific targets, and using metrics to measure progress. This structured approach ensures transparency and accountability in sustainability reporting.

S

SASB - The IFRS Foundation's Sustainability Accounting Standards Board develops industry-specific sustainability accounting standards. These standards help companies disclose financially material sustainability information to investors in a standardised and comparable way. The SASB is committed to maintaining, enhancing, and evolving the ISSB standards and encourages both preparers and investors to continue using them.

SFDR - The Sustainable Finance Disclosure Regulation is a regulatory framework launched by the European Union to promote sustainability in the financial sector. Implemented in March 2021, SFDR requires financial market participants and financial advisors to disclose information about the environmental, social, and governance (ESG) aspects of their investment products and services.

T

TCFD - The Task Force on Climate-related Financial Disclosures is a framework developed to help organisations disclose climate-related risks and opportunities in a consistent, comparable, and efficient manner. Introduced by the Financial Stability Board (FSB) in 2015, TCFD provides guidance on how companies can integrate climate-related information into their existing financial reporting processes. It aims to assist businesses in understanding and disclosing the financial impact of climate change on their operations, facilitating informed decision-making by investors, lenders, insurers, and other stakeholders.

V

VSME - The Voluntary European Sustainability Reporting Standards initiative, introduced by EFRAG in November 2022, is aimed at simplifying sustainability reporting for small and medium enterprises (SMEs) and micro-entities within the EU. It functions independently of the CSRD mandate and offers a flexible framework tailored specifically for non-listed SMEs.

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