Only 42% of Companies Confident in Meeting CSRD Reporting Requirements, PwC Survey Finds

A new survey by PwC reveals that less than half of companies required to report under the EU’s Corporate Sustainability Reporting Directive (CSRD) in 2024 are fully confident in their ability to meet the directive’s ambitious sustainability reporting standards. Despite the widespread recognition of the directive's significance, just 42% of respondents from large companies required to report on sustainability by next year feel fully prepared. For companies due to report the following year, that confidence drops to a mere 14%.

The CSRD, which replaces the EU’s Non-Financial Reporting Directive (NFRD), significantly expands the scope of companies that must disclose sustainability impacts, raising the number of affected companies from approximately 12,000 to over 50,000. The new regulations, based on the European Sustainability Reporting Standards (ESRS), cover detailed reporting on environmental impact, human rights, social issues, and sustainability-related risks.

While the first group of companies required to report under the CSRD—those with over 500 employees—must submit their sustainability reports in 2025, the regulation will eventually expand to include companies with as few as 250 employees and €50 million in revenue by 2026. Smaller listed SMEs will begin reporting in 2027, and non-EU firms with significant EU revenues will face reporting obligations by 2029.

PwC’s survey of 215 C-suite executives—including CEOs, CFOs, CIOs, COOs, and Chief Sustainability Officers—found a lack of readiness, with only 4% of companies set to report in 2024 being prepared to publish a CSRD report. An additional 22% are still grappling with understanding the CSRD’s concepts and requirements, and a substantial 5% have not even begun their implementation efforts.

Data quality and consistency were identified as the biggest hurdles by companies reporting in 2024, with 55% of them citing these concerns. In contrast, smaller companies reporting in 2025 were more focused on resource constraints, with 54% of them indicating this as their primary challenge.

Despite the gap in preparedness, the survey underscores the material importance of CSRD reporting to companies. Over half of the executives polled believe that CSRD reporting will significantly affect value creation, particularly in areas such as financing conditions (47%), employee retention (42%), and company valuation (36%). Moreover, more than 85% of respondents indicated that they plan to use sustainability data from CSRD reports as a key performance indicator (KPI) for determining executive compensation.

“The CSRD is the cornerstone enabling Europe to deliver on the European Green Deal,” said Michael Horvath, Advisory Partner and Sustainability Leader at PwC Luxembourg. “It elevates sustainability reporting to the same level of importance and rigour as financial reporting, prompting companies to integrate sustainability into their strategic decision-making processes.”

As companies scramble to meet the CSRD’s deadlines, most are investing heavily in the technology and human resources needed to manage the increased volume of sustainability data. More than 90% of companies that must begin reporting in 2024 or 2025 are either already implementing or planning to implement technology solutions for CSRD compliance. However, as of now, only 36% of companies reporting in 2024 and 15% of those reporting in 2025 have technology systems in place to handle non-financial reporting.

In addition to technological investments, training programs are being developed across the board, with more than half of the companies allocating between 3 to 5 full-time employees to CSRD-related tasks. A further 20% are dedicating between 6 and 10 employees to support the compliance process.

Olivier Carré, Deputy Managing Partner and Technology & Transformation Leader at PwC Luxembourg, noted, “The successful implementation of CSRD hinges on leveraging advanced technology solutions that can efficiently manage and integrate vast amounts of sustainability data. Companies must invest in robust data management systems to meet the demand for accurate, real-time ESG reporting.”

As the deadline for CSRD reporting draws closer, the need for comprehensive planning and investment in both technology and human resources has never been more pressing. Companies that fail to rise to the challenge may risk falling short of the EU’s sustainability reporting standards, with implications for their access to finance, reputation, and long-term sustainability goals.

The GRC Report is your premier destination for the latest in governance, risk, and compliance news. As your reliable source for comprehensive coverage, we ensure you stay informed and ready to navigate the dynamic landscape of GRC. Beyond being a news source, the GRC Report represents a thriving community of professionals who, like you, are dedicated to GRC excellence. Explore our insightful articles and breaking news, and actively participate in the conversation to enhance your GRC journey.