Start here

Sustainability reporting, explained

Sustainability reporting is how companies disclose their environmental, social and governance performance alongside their financial results. It is a crowded space of frameworks and acronyms; this hub maps the whole landscape in plain English and points you to the deeper guides for each piece, including where the EU CSRD fits. European Commission

TL;DR

  • What: disclosing ESG performance, impacts, risks and strategy alongside financials.
  • Why: investors, regulators and customers want comparable, decision-useful, audited data.
  • The frameworks: CSRD/ESRS, GRI, ISSB (IFRS S1/S2), VSME, and legacy TCFD and SASB.
  • Where CSRD fits: the most comprehensive regime, unique for double materiality.
Compare the frameworksAm I in scope for CSRD?

What sustainability reporting is

Sustainability reporting is the practice of disclosing a company environmental, social and governance (ESG) performance, impacts, risks and strategy alongside its financial reporting, so investors, regulators, customers and the public can assess the business beyond its profit and loss. Over the past decade it has shifted from glossy voluntary brochures toward standardised, audited, machine-readable disclosure. European Commission

Why it matters

The logic is simple: to allocate capital and manage risk, stakeholders need reliable, comparable sustainability data, just as they rely on audited financial statements. Regulation, investor demand and customer pressure have all converged, so sustainability data is increasingly mandatory, assured, and tied directly into corporate reporting rather than sitting in a separate report.

The frameworks landscape

Several major frameworks coexist. The practical question is which apply to you and how they relate. Here is the short version; for a side-by-side comparison see our ESG reporting frameworks page.

CSRD / ESRS

The EU mandatory regime. Unique for requiring double materiality (impact and financial). The most comprehensive standard, and the one consolidating the field.

ISSB (IFRS S1 / S2)

The global baseline of investor-focused, financial-materiality disclosures from the IFRS Foundation. Being adopted across 30-plus jurisdictions.

GRI

The longest-established, most-used voluntary standard. Impact-materiality focus, broad stakeholder audience. Interoperable with ESRS.

VSME

The EU voluntary standard for smaller companies, also acting as the value-chain cap: a ceiling on what large companies can demand from small suppliers.

TCFD

The four-pillar climate framework, now absorbed into ISSB IFRS S2 and reflected in the ESRS structure. The task force itself has been disbanded.

SASB

Industry-specific financial-materiality metrics, now consolidated under the ISSB. No longer a standalone destination.

What a sustainability report contains

Whatever the framework, a sustainability report typically covers the same building blocks. Under CSRD these map onto the ESRS structure of governance, strategy, impact/risk/opportunity management, and metrics and targets.

  • Governance of sustainability (board oversight, management roles).
  • Strategy and business model, including the transition plan and resilience.
  • The materiality assessment and material topics.
  • Policies, actions and targets per topic.
  • Metrics: GHG emissions (Scopes 1, 2 and 3), energy, water, waste, diversity, safety.
  • Value-chain and due-diligence information.
  • Often EU Taxonomy KPIs and third-party assurance.

Where CSRD fits, and why frameworks are converging

CSRD is the most far-reaching sustainability-disclosure law in the world. Because it requires double materiality, an ESRS report effectively spans both the GRI impact lens and the ISSB financial lens, so a CSRD reporter can usually satisfy much of GRI and ISSB with incremental mapping. ESRS E1 and IFRS S2 share the TCFD architecture, and EFRAG has interoperability guidance with both GRI and the ISSB to cut double-reporting. ESRS Set 1, Delegated Reg. (EU) 2023/2772

The practical takeaway: build one data architecture, tag each datapoint to the frameworks that apply, and report once. New here? Start with what CSRD is, check whether you are in scope, then read up on double materiality.

The EU rules are in flux

The Omnibus I Directive (Directive (EU) 2026/470) narrowed CSRD scope sharply and the revised ESRS, in public consultation from 6 May 2026, cuts mandatory datapoints by more than 60 percent, with a final delegated act expected around mid to late 2026 (applying FY2027). If you read older guidance, check it against the current position. We track every change in The CSRD Brief. Council of the EU

Go deeper

Explore the rest of the hub

What is CSRD?The EU regime, post-Omnibus.The ESRS standardsThe 12-standard map.Double materialityThe DMA, step by step.Scope 1, 2 and 3The carbon footprint, explained.GHG ProtocolBoundaries and inventories.EU TaxonomyEligibility, alignment, KPIs.Frameworks comparedCSRD vs GRI vs ISSB.For suppliersAsked for data? Start here.ToolsFree, ungated calculators.

FAQ

People also ask

What is sustainability reporting?

Sustainability reporting is the practice of disclosing a company environmental, social and governance (ESG) performance, impacts, risks and strategy alongside its financial reporting, so investors, regulators, customers and the public can assess the business beyond its profit and loss. It increasingly follows standardised frameworks such as the ESRS, GRI and ISSB.

Is sustainability reporting mandatory?

It depends on where you operate and your size. In the EU, CSRD makes it mandatory for large companies above the thresholds. Globally, ISSB standards are being adopted in 30-plus jurisdictions. Elsewhere, frameworks such as GRI remain voluntary. Many smaller companies report voluntarily, often using the VSME standard, or because customers ask.

What frameworks exist for sustainability reporting?

The major frameworks are CSRD/ESRS (the EU mandatory regime, double materiality), the ISSB IFRS S1 and S2 (investor-focused, financial materiality), GRI (the most-used voluntary impact standard), and the legacy TCFD and SASB, both now folded into the ISSB. VSME is the EU voluntary standard for smaller companies.

What goes in a sustainability report?

A typical sustainability report covers governance of sustainability, strategy and business model (including a transition plan), the materiality assessment and material topics, policies, actions and targets per topic, metrics such as Scope 1/2/3 emissions, energy, water, waste, diversity and safety, value-chain and due-diligence information, often EU Taxonomy KPIs, and a third-party assurance statement.

What is the difference between GRI, ISSB and CSRD?

GRI focuses on impact materiality for a broad stakeholder audience and is voluntary. ISSB focuses on financial materiality for investors and is mandatory where jurisdictions adopt it. CSRD/ESRS is the EU mandatory regime and is unique in requiring double materiality, both impact and financial, so it effectively spans the other two lenses.

Where does CSRD fit in the landscape?

CSRD is the most comprehensive regime and is consolidating the field. Because it requires double materiality, an ESRS report can cover much of GRI (impact) and ISSB (financial) with mapping. ESRS E1 and IFRS S2 share the TCFD architecture, and EFRAG has interoperability guidance with both GRI and the ISSB to reduce double-reporting.

This is guidance, not legal advice

This page is a plain-English orientation to sustainability reporting; it is not legal advice. For decisions specific to your business, confirm with the official sources we link or a qualified adviser.

Sources

  1. [1]European Commission: Corporate sustainability reportingretrieved 8 Jun 2026
  2. [2]Global Reporting Initiative (GRI) Standardsretrieved 8 Jun 2026
  3. [3]IFRS Foundation: International Sustainability Standards Board (ISSB)retrieved 8 Jun 2026
  4. [4]Delegated Regulation (EU) 2023/2772 (ESRS Set 1)retrieved 8 Jun 2026
  5. [5]Council of the EU: sign-off of the Omnibus simplification (24 Feb 2026)retrieved 8 Jun 2026

The CSRD Brief

One email to stay on top of the whole space

The CSRD Brief: plain-English updates on CSRD, ESRS, the EU Taxonomy and the Omnibus. We watch Brussels so you don't.

No spam. Unsubscribe anytime.