The main goal of business is to make money, as the saying goes. But the times are changing quickly. With the rise of the sustainability goals, motivations of entrepreneurs are shifting from mere profit-making. In this insight, we dive into sustainability communication through facts and data, placing it in the context of CSRD, the new Corporate Sustainability Reporting Directive. In brief:
In its general definition, “sustainable development” is an ethical concept which assumes that no form of economic growth should endanger our future. An increasing number of economies, with the European Union seen a global leader on the topic, are focused on improving the well-being of citizens, making the economy climate-neutral, as well as protecting, conserving and enhancing the biodiversity.
No doubt, achieving these goals requires that the markets shift to more sustainable models of growth. To monitor and evaluate how such change is progressing, different tools are being developed. Those tools are made to measure and communicate which organizations are contributing the most to a greener world.
The market is becoming increasingly well adapted to this approach. Many actors are interested in concrete facts and in the data communicated by the companies about their sustainability. Customers, communities, investors and even banks, insurance or asset management companies are on the receiving end of enterprise disclosures. Those stakeholders are looking to analyze how the business interacts with society and the environment, knowing that positive impact in this regard can create a genuine added value in the enterprise’s operations.
Providing comprehensive information that reaches beyond the profitability is often referred to as releasing the non-financial disclosures. This aspect of sustainability communication becomes an increasingly important factor in green economy, allowing to manage the economy transition, build trust in the market, encourage responsible investments and anticipate the risks and impacts related to business operation.
At the same time, communicating the efforts in the sustainability field is a complex matter that needs a factual and structured approach. Realizing this, the governments, including the European Commission, are working to introduce new regulations which set frameworks on how to inform about the outcomes in this matter. These emerging regulations are meant to encourage investment and trust towards the sustainable businesses and will create new challenges and opportunities for the market.