If you too think that new framework of Reporting Rhymes with new indicators and new calculation methodologies, rest assured: you are not alone! When the CSRD (Corporate Sustainability Reporting Directive) came into force in January 2024, the first instinct of the companies submitted was to count the number of indicators it required to produce.

The result of the races is a list of more than a thousand data points that make you dizzy. And yet, in reality, only 30% of these data points are actually indicators - and you will only have to publish a tiny part of them in your report! So there's no reason to panic. Let's find out together what is really behind these CSRD indicators.

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What is an indicator for CSRD?

Data point: indicator or not indicator - that is the question.

The definition of what an indicator is in the CSRD is not always very clear, especially because of abuse of language and hasty translation concepts. Let's first put the dots on the i's: what is an indicator for CSRD?

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The CSRD datapoints (data points)

As you already know (and if you don't know it, we recommend This great article), the CSRD is organized in paragraphs, called DR (for Disclosure Requirements), which are themselves organized in DP (for DataPoint, or data point).

This organization gives the directive a clear and understandable architecture, in which it is easy to navigate and find your way around.

Concretely, A data point is a single piece of information to be published in your CSRD report. These data points are 1000+ in number. They are divided into narrative data points - asking you to respond with a sentence or word, and quantitative data points - requiring you to produce a number. To generalize, it is common to use the term metrics to talk about these DPs, both for narrative and quantitative information.

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The concept of a narrative data point

A narrative data point is a CSRD requirement that asks you to produce a text to answer it.

It may be the description of a policy in place in your business, theExplanation of actions that you have done to reduce your environmental impact, or even a putting into context allowing you to better understand your performance on a social subject.

These narrative data points correspond to more than 2 thirds of CSRD data points, and are subject to a double materiality analysis so that you only publish those that are relevant to your business.

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The concept of a quantitative indicator

A small third of CSRD data points are metrics - quantitative indicators, for which a numerical answer is expected.

These indicators, present in all categories - environmental, social, governance, can be witnesses of your water or energy consumption, the number of employees in your company, or even financial amounts allocated to action plans.

These quantitative indicators, like the narratives, are subject to a double materiality analysis so that you can focus your efforts on those that really correspond to your impacts.

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In the rest of this article, we will use the term “indicators” to refer only to quantitative indicators.

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CSRD environmental indicators

Now that we've clarified what indicators are in CSRD, let's dive into the heart of the matter: what are these indicators.

Essential indicators...

Impossible to think about your CSR strategy without measure its environmental impact. This is why the CSRD asks you to publish very classical environmental indicators, both on the climate, water management or waste production. These indicators include:

• Your GHG emissions - Scope 1, 2 and 3
• Your energy consumption - by type of source
• Your water consumption, discharges and storage
• Your quantity of waste produced, and in particular the quantity recycled.

No surprise for companies that have embarked on a CSR approach for several years. Moreover, it is about indicators that are found in the majority of environmental standards and labels.

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... and more specific, but just as important, indicators!

Some of the CSRD environmental indicators are less well controlled by companies, although they are key to proving the credibility of your approach. Here are our top 5 of the least published indicators in the first reports:

1. the anticipated financial effects of climate or other risks on company performance
2. the company's monetary provisions for the remediation of its negative impacts (depollution, restoration of an ecosystem, etc.)
3. the change in land use related to company operations during the reporting year
4. the expected lifespan of your products compared to the average lifespan of similar products on the market
5. the water intensity of your operations.

The European Commission is well aware of the difficulty these indicators can represent for companies subject to CSRD, which is why it leaves a transition period of several years for businesses to start publishing them.

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The social indicators of the CSRD

Social indicators are often the easiest to produce. for companies embarking on the process, both because they are more pragmatic and because they are often already followed by HR teams.

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Describe your employees in the CSRD

Many of the CSRD indicators are linked to the description of your workforce, and the positive and negative impacts you have on them:

• Number of employees - by gender, by age, by country, by type of contract
• Workplace accident rate
• Percentage of workers with disabilities in the workforce
• Gender pay gap
• Staff turnover rate
• Average number of hours of training per person

These are all classic indicators that are more or less easy to compile according to the specificities of your business.

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What is the concept of non-employee?

The CSRD introduces a very particular concept, that of non-employees. These are people who work for you full time but with whom you do not have an employment contract as such. They can be freelancers or people made available by employment companies..

The CSRD indicators associated with non-employees may seem unusual for many businesses, since it is a question of accounting for their number, but also the extent of their rights in terms of social protection and working conditions - data to which businesses do not always have direct access.

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Indicators concerning external stakeholders

Other stakeholders external to your company also have dedicated indicators. This is the case in particular:

• Of workers in your value chain, for which the CSRD invites you to compile health and safety indicators
• Of customers and users of your products, for which you can present the number of complaints received following the use of your products and services.

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The general indicators of the CSRD

In addition to environmental and social indicators, the CSRD offers other indicators to present your company and its business relationships.

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Describe your organization

Before diving into ESG topics, it is important to properly present your business: activities, key products, internal organization... For all this, the CSRD requires you to highlight a certain number of indicators, such as your turnover over the year, and more particularly your turnover from sectors with a high climate impact, or such as the parity ratio within your governance bodies (board of directors, COMEX, etc.).

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White paper on ethics

A detour now to Governance indicators. The CSRD requires numerous indicators on business conduct to the companies submitted, in conjunction with stakeholder requests and current national regulations.

So, we are waiting for you to publish:

• The number of cases of human rights violations reported during the year
• The number of reported cases of corruption and conflicts of interest, and associated fines
• The number of hours of corruption prevention training for risky business functions
• The amount of lobbying activities financed during the fiscal year

These are all indicators that make it possible to understand the extent of your company's ethical commitments.

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Talk about the relationship with your suppliers

Finally, the CSRD offers indicators to describe your relationships with your suppliers, and in particular to ensure that small suppliers are properly paid by the largest client companies. In fact, the ESRS propose to explain your standard payment practices by vendor type (in number of days), and to indicate the percentage of these standards that are met. Where applicable, the CSRD requires you to publish the fines paid for late payments from your suppliers.

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Conclusion

Within the CSRD, there are nearly 200 quantitative indicators that companies must publish in their report. However, all these indicators are not to be published by all companies. Indeed, the double materiality analysis carried out prior to the report production exercise makes it possible to sort out, and to retain only the indicators that are relevant to you.

At Kiosk, we provide you with 50 first indicators of the CSRD to understand these indicators in more detail. Contact us for the complete list!

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