This is a publication that is part of RSM's Voice of SCM. On a monthly basis, RSM issues the Voice of Supply Chain Management (SCM). Our consultants follow global developments and translate their impact into practical considerations for internationally active companies. 

The outlook for CSRD reporting in 2027 is now much clearer, because the revised scope of the Corporate Sustainability Reporting Directive (CSRD) has been agreed and the reporting timetable is set. For many companies, the first mandatory reporting year will be financial year 2027, with publication taking place in 2028, so earlier work should now be updated and refined. Until now, CSRD work has meant extensive preparation followed by a period of uncertainty. Over the past two years, organisations invested time and resources into double materiality assessments, stakeholder engagement, gap analyses and data mapping exercises. Sustainability teams worked alongside finance, risk and operational functions to build the foundations for reporting under a completely new regulatory framework.

This article was written by Kirill van der Velde (kvandervelde@rsmnl.nl) and Bart Ladru (bladru@rsmnl.nl). Kirill and Bart are consultants with RSM Netherlands with a focus on ESG and supply chain management.  

The introduction of the Omnibus proposals and subsequent legislative discussions created understandable hesitation. Companies questioned whether previously completed work would remain relevant, whether reporting requirements would change again and whether investments in reporting readiness were still justified. Some organisations paused projects entirely while awaiting clarity on the future direction of the legislation. That clarity has now largely arrived. The simplified European Sustainability Reporting Standards (ESRS) have also been finalised. Companies now have a much clearer understanding of whether they remain in scope and what will be expected of them. While the reporting burden has been reduced compared with the original framework, the requirements remain substantial for those organisations still subject to the legislation.

As a result, the discussion should no longer be centred on regulatory uncertainty. The focus should shift towards practical implementation and ensuring organisations are ready to collect high-quality sustainability information from the very first day of their initial reporting period.

What has changed since the original CSRD?

The primary objective of the Omnibus reforms was to simplify sustainability reporting requirements and reduce the administrative burden of ESG compliance. Policymakers recognised concerns from businesses regarding reporting complexity, the volume of disclosure requirements and the pace of implementation. The most visible change is a sharp reduction in the number of companies that fall within scope. The revised thresholds focus mandatory reporting on larger organisations, while many entities that originally expected to report will no longer be required to do so. Listed small and medium-sized enterprises (SMEs) have been removed from mandatory scope, and employee and turnover thresholds have increased considerably.  

The reporting timetable has also been adjusted. Through the "stop-the-clock" measures, many companies received an additional two years before their first mandatory report. This additional time was intended to provide organisations with greater certainty and allow regulators to finalise a simpler reporting framework.  

A third important development concerns the ESRS themselves. One of the most common criticisms of the original framework was the sheer volume of potential disclosure requirements. The revised standards reduce datapoints, remove overlaps between standards and provide greater flexibility regarding the information companies are expected to disclose. The intention is to improve usability while maintaining decision-useful information for investors and other stakeholders.  At the same time, organisations should not interpret simplification as deregulation. The principles underpinning CSRD remain intact. Double materiality remains central to the reporting approach. Companies must still identify their material impacts on people and the environment, as well as sustainability-related risks and opportunities that may affect enterprise value. Governance, strategy, policies, actions, targets and performance metrics remain critical components of sustainability reporting.  

Is existing work still a strong starting point?

One concern frequently expressed by management teams is whether the work completed before the Omnibus reforms still has value. In most cases, companies should view previous efforts as an asset rather than a sunk cost. Many organisations have already completed extensive double materiality assessments. They have interviewed stakeholders, analysed sustainability topics, assessed impacts, risks and opportunities and developed initial reporting roadmaps. Even where methodologies may require refinement, this work continues to provide a strong foundation for future reporting. The same applies to gap assessments. Many companies have already mapped disclosure requirements against existing policies, processes and available data. They have learned where information sits within the organisation and which functions matter most for sustainability reporting.

Many organisations have also begun building internal awareness. Senior management teams, board members and operational functions are far more familiar with sustainability reporting concepts than they were two years ago. This organisational learning should not be underestimated. Establishing a shared understanding of sustainability reporting requirements often represents one of the most challenging aspects of implementation. Organisations should therefore focus on updating and refining existing work. Materiality assessments should be revisited to confirm they still reflect current business realities, gap analyses refreshed against the revised ESRS, and data requirements validated and prioritised against the actual reporting obligations.

Where do most companies still face challenges?

Although many companies have made substantial progress, several common challenges remain.

1. Materiality assessments need validation

For organisations that completed their materiality assessments in 2023 or 2024, business circumstances may have changed considerably. New products may have been introduced, acquisitions completed, supply chains adjusted or risks changed. Stakeholder expectations have also continued to evolve. Customers, investors, employees and regulators expect sustainability reporting to focus on the issues that matter rather than becoming a compliance exercise. Companies should therefore use the coming months to revisit earlier assessments and confirm that identified impacts, risks and opportunities remain valid. This does not always require a completely new assessment. A structured validation exercise is often enough to keep reporting priorities aligned with the organisation's current reality.

2. Data collection remains the largest operational challenge

Materiality assessments receive most of the attention, but in practice data collection turns out to be the most demanding part of implementation. Most companies are capable of determining which sustainability topics are material. The more difficult question is whether reliable information exists to support required disclosures. Sustainability-related information is typically spread across departments and systems, with environmental data held by operational teams, workforce information in HR systems and supplier-related data in procurement. Some information is not formally collected at all. During readiness assessments, companies frequently identify disclosures for which no established reporting process currently exists. In some cases, information is captured manually. In others, methodologies are inconsistent across business units or geographic locations. The challenge becomes even greater when data originates outside the organisation. 

Many sustainability disclosures require information from suppliers, contractors, distributors or other value-chain partners, and for companies in international trade those partners are often located in several jurisdictions. Gathering this information often requires new processes, contractual arrangements and engagement strategies. These challenges cannot be solved at year-end. If organisations wait until late 2027 to evaluate data quality, they risk discovering information gaps that cannot be retrospectively corrected. For this reason, leading organisations are treating 2026 as a testing period. They are conducting trial data collections, validating methodologies and identifying weaknesses before reporting obligations formally begin.

3. Governance structures are still maturing

Another recurring observation is that reporting responsibilities are often insufficiently defined. Sustainability reporting touches nearly every business function. It requires contributions from finance, operations, procurement, supply chain management, HR, legal, compliance, risk management and executive leadership. Even so, many organisations still approach CSRD as a sustainability-department project, which creates serious implementation risks. Successful reporting programmes have clear ownership: every disclosure area has a designated owner, responsibilities for data collection, validation, review and approval are documented, escalation procedures exist and management receives regular progress reports. The role of finance functions is particularly important. As sustainability reporting becomes more integrated with financial reporting processes, many organisations are expanding the involvement of finance teams in controls, governance and assurance readiness. The companies that perform best during their first reporting cycle are rarely those with the largest sustainability teams. More often, they are the organisations that have embedded sustainability reporting responsibilities across the broader business.

Why does the postponement not mean preparation can wait?

The postponement of reporting obligations has led some organisations to conclude that preparation can also be postponed. This is a costly misconception. Although reporting on financial year 2027 may appear distant, readiness activities need a long lead time. Policies must be updated and systems configured, data owners trained, reporting methodologies developed and tested, and internal controls put in place. Many companies are also preparing for external assurance over sustainability information. Even where requirements have been simplified, assurance providers will still expect organisations to demonstrate clear processes, sound methodologies and reliable evidence supporting reported information.

Building this infrastructure takes time. We therefore advise organisations to use 2026 as a preparation year. The most effective reporting programmes use this period to conduct dry runs, test reporting processes and identify weaknesses before the first mandatory reporting cycle begins. By the time financial year 2027 starts, organisations should ideally have answered three questions: which disclosures are material, who owns each disclosure area and what data is required.  Companies that can confidently answer these questions are likely to experience a considerably smoother first reporting cycle.

While ESG compliance remains an important driver, organisations should not overlook the broader value that can emerge from CSRD preparations. The process of conducting materiality assessments, evaluating risks and opportunities and strengthening data management often provides new insights into business performance and resilience. Many organisations discover opportunities to improve operational efficiency, enhance supplier engagement, strengthen risk management and increase transparency for investors and customers. Good sustainability reporting depends on how well an organisation understands its own business, and companies that use the preparation period to strengthen governance and decision-making are likely to see benefits well beyond regulatory compliance.

How can companies prepare for CSRD reporting in 2027?

The Omnibus reforms have reduced complexity and provided certainty, but the responsibility to prepare remains. For organisations that remain within scope, the run-up to 2027 has now started. The good news is that many companies are not starting from zero. Earlier investments in materiality assessments, stakeholder engagement and reporting readiness continue to provide a valuable foundation. The challenge now is turning those foundations into a functioning reporting process capable of producing reliable, decision-useful information.

Over the next year, organisations should focus on validating materiality outcomes, strengthening data collection processes, clarifying responsibilities and testing reporting mechanisms. When financial year 2027 begins, all necessary processes, responsibilities and data collection mechanisms should already be operating effectively.

RSM is a thought leader in the field of supply chain management and international trade, including ESG. We provide frequent insights through training and thought leadership, based on detailed knowledge of industry developments and practical application gained from working with our clients. RSM helps companies connect individual geopolitical and regulatory developments to the broader changes affecting their supply chains. By doing so, we support businesses in distinguishing short-term disruption from structural change and translating that assessment into coordinated decisions on sourcing, origin, landed cost, logistics and supply chain design. If you would like to discuss what these connected developments mean for your business, please contact one of our consultants.

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