ESG Disclosure: Article 1 | The obligation to publish a sustainability report

For many companies, the sustainability report is a closed book.

Or rather, the most commonly practiced form of procrastination - the continuous postponement of challenges. We have analyzed this complex topic, delved deeper into the most important information and prepared it in four articles.

What does ESG disclosure involve?

For financial institutions and numerous companies, this involves the mandatory publication of information on environmental, social and corporate governance aspects - in Switzerland, Europe, the USA or internationally. A good idea to create more transparency in the corporate environment, promote sustainable investing and enable risk and opportunity assessments.

Solving problems with ESG disclosure.

While ESG disclosure is already part of the mandatory program for some companies, the hairs on the back of the neck are still standing up for others. Criticism ranges from overly bureaucratic, to data monsters, to completely over-regulated. Unfortunately, we at MDD cannot solve the problem for you. But we can provide you with significant support.

Two positive effects of ESG disclosure.

Sustainability reports generate trust: the trust of the authorities, potential and existing shareholders, partners and customers. On the other hand, ESG disclosure requirements make it easier for companies to establish sustainable processes or choose sustainable suppliers. An impact that will certainly contribute to preserving our quality of work and life.

The framework for sustainability reporting in the EU.

The Corporate Sustainability Reporting Directive (CSRD) and the European Sustainability Reporting Standards (ESRS) are key EU regulations for sustainability reporting. The CSRD sets out the legal framework, while the ESRS define detailed requirements. ESG disclosure is comprehensive and complex, with over 100 disclosure requirements. This poses a major challenge for companies without any previous systematic ESG data collection.

«Regulation is necessary to oblige companies to take sustainability goals seriously. ESG disclosure rules are often perceived as excessive. However, they promote transparency and long-term values.»

«Companies that integrate sustainable practices out of inner conviction will benefit from competitive advantages by complying with regulatory requirements and thus legal requirements. At the same time, their own sustainable initiatives protect our environment and social cohesion.»

Would you like to find out more details about ESG disclosure or the automated creation processes for sustainability reporting?

Book a connect call with Fabio Negro, COO at MDD or view his contact details below. 

Note on the article series:

• This was article Nr. 1 on the topic of ESG disclosure and the obligation to publish a sustainability report.
• In article Nr. 2, we report on the current ESG disclosure rules and which companies in Switzerland are specifically affected.
• Article Nr. 3 answers the most important questions on how companies can already prepare for the obligation to publish a sustainability report.
• Article Nr. 4 illustrates the advantages of the MDD platform in the preparation of sustainability reports.