Data from the latest Ayming Polska report indicates that only 25% of surveyed companies have implemented ESG reporting standards in line with the CSRD directive requirements. These companies have an established management structure for the discussed area, unlike firms that have not yet implemented the appropriate procedures. The study also reveals that one of the main obstacles in reporting is the lack of consistent guidelines, indicated by 59% of respondents. According to an expert from Ayming Polska, this situation largely arises because, although the reporting standards have been unified by CSRD, specific instructions on how to proceed are sometimes lacking.
From the Ayming Polska report titled “Business in Balance: How to Accelerate ESG Transformation?”, it appears that for nearly half (48%) of the enterprises, the main difficulty in the area of ESG transformation is effectively measuring and reporting the impact of their activities on the natural and social environment.
Partly, the CSRD directive, which is gradually being implemented and covering more companies each year, could be a solution in this context. By defining new standards in sustainable development reporting, the directive addresses one of the key challenges that nearly half of the companies in our survey are struggling with. It is important to remember that not all information needs to be disclosed in the first year of reporting – the ESRS standards have phased disclosure requirements for some indicators and information – explains Monika Michalska, ESG Consultant, Ayming Polska
The new regulations are not only an adaptive challenge for companies but also an opportunity to systematize internal reporting and organizational procedures, including the division of duties and responsibilities – adds the expert.
Since the beginning of this year, the obligation to submit a non-financial report applies to companies with over 500 employees and revenues of 50 million euros or assets of 25 million euros. In 2025, this requirement will extend to large companies and main units of capital groups meeting two of the three criteria: over 250 employees, 25 million euros in assets, or 50 million euros in revenue.
The companies that will be subject to the reporting obligation from next year constituted the sample for the study conducted by Ayming Polska.
Only 25% of Companies Ready for CSRD
The results show that most of the surveyed companies are working on implementing the appropriate mechanisms, but the degree of advancement varies among them. 25% of respondents declare that their organizations have already achieved the required goals. However, the majority indicated that their companies are still at an early stage of preparation – 36% are in the process of preparing to implement the standards, and 38% are just planning the necessary actions in this regard.
Implementing specific reporting procedures even before the formal reporting obligation can bring several benefits to companies. Primarily, it is a time to test and optimize data collection processes, including identifying potential organizational issues. Additionally, the costs of preparing the report can be spread over time. This is particularly beneficial when the organization collaborates with an external company and plans formal updates to internal documents to meet the minimum disclosure requirements in line with the ESRS standards – explains Monika Michalska.
Early preparation for the audit process also increases the reliability and quality of the collected information. This approach minimizes the impact of new reporting obligations on other organizational processes, allowing employees to smoothly integrate existing tasks with new requirements. As a result, the organization becomes better prepared to meet future reporting requirements, which supports its long-term development and transparency – adds.
Lack of Unified Standards and Technical Aspects Hinder Reporting
The vast majority of companies (82%) perceive reporting on sustainable development activities as a complex task.
According to respondents, the difficulties in this area include not only technical aspects such as data collection and verification, indicated by 55% of respondents but also more fundamental problems, such as the lack of unified reporting standards, cited by 59% of respondents.
Why did such a large percentage of respondents point to the problem of lacking unified reporting standards, even though CSRD seems to present a clear and straightforward approach? An expert from Ayming Polska emphasizes that while the reporting standards (ESRS) defined in the directive are the primary document for disclosing most required information, the regulator allows the use of various methodologies and legal bases not part of the ESRS standards.
Additionally, in several cases, the regulator does not provide an example of the required approach, which can generate difficulties in reporting information and requires specialist knowledge and preparation for disclosure well in advance – explains Monika Michalska.
For example, the E1-9 requirement “Anticipated financial effects arising from significant physical risks and transition risks, and potential opportunities related to climate” states that “There is currently no universally accepted method of assessment or measurement to determine how significant physical and transition risks may impact the future financial position, financial performance, and cash flows of an entity. Therefore, the disclosure of financial effects will depend on the entity’s internal method and significant judgment in determining the inputs and assumptions necessary to quantify the anticipated financial effects.” – this requirement does not explain what significant judgment is and when it should be considered that the method, approach, and assumptions for calculations are appropriate and sufficient – adds.
The challenges associated with identifying and assessing the impact on the environment or community are highlighted by 52% of survey participants. Additionally, 50% of respondents signaled a lack of internal resources and specialist knowledge, and 42% encountered difficulties in conveying the results in an understandable manner, which underscores the complexity of managing ESG data and points to areas requiring particular attention and possible optimization.
Personnel Structure in ESG Reporting Management
Companies that have already implemented ESG reporting standards clearly define the management structure responsible for these activities. The study shows that 80% of respondents indicate the Director of Sustainable Development/ESG as the key figure responsible for managing these issues.
Defining responsibility for sustainable development and ESG reporting within the organization is crucial for effective management of this area. It is also one of the information disclosure requirements. ESRS 2 GOV-1 asks about the composition of the governing bodies, their roles, and responsibilities, including the allocation of responsibility for impacts, risks, and opportunities (possibilities) within tasks. Assigning responsibility for ESG activities to directors or managers of other departments may lead to fragmented responsibility and lack of a proper management structure for the ESG area, consequently causing difficulties in data collection and results from conducted work into a coherent report – explains Monika Michalska.
In companies preparing to implement CSRD standards, the situation is quite different. The vast majority of them (68%) have not yet designated a specific person or team responsible for managing ESG reporting. Only 14% of companies delegate these responsibilities to the Director of Sustainable Development/ESG, and 13% to senior management. Among those planning implementation, the absence of a designated decision-maker is even more pronounced, covering 83% of companies.
This situation may result from a lack of knowledge about the process, its complexity, and time-consuming nature. Understanding the methodology and responsibility structure is crucial, especially for organizations that have not yet published a sustainable development report. It should be remembered that for such an organization, collecting data, preparing documentation, and completing formalities means several months to over a year of intensive work – comments the Ayming Polska expert on the results.
Over Half of Companies Do Not Use External Support in ESG Reporting
Despite ESG reporting being a significant challenge for companies, and most of them not having a clearly defined management structure for this area, 54% of respondents declare that their organizations do not use external support in this regard. This may partly result from the fact that many companies are currently at the initial stages of developing and implementing appropriate strategies.
Sustainable development reporting, being a multi-stage and highly complex process, is closely linked with financial reporting, requiring the analysis of non-financial data and its integration with financial data. This requirement includes not only the analysis of double materiality but also the assessment of the financial consequences of risks, imposed penalties, or the impact of climate issues on executive remuneration. Particularly for companies with an extensive value chain operating internationally, relying solely on internal resources may prove inefficient and time-consuming, and the lack of coordination, objective assessment of activities, or knowledge of best reporting practices becomes the main obstacle. In such a context, external support may be crucial, especially in the initial phase of creating a sustainable development strategy – explains Monika Michalska.
Among companies that currently do not use external support, as many as 60% (56% “rather yes” and 4% “definitely yes” responses) are considering engaging such support in the future.
