Posted on September, 16 2024

The clock is ticking towards next year’s EU deadline for companies and financial institutions to start publicly disclosing their impact on people and the environment.

It’s a critical process given the worsening nature and climate crises, and one that the WWF Risk Filter Suite – a free, online platform that brings together two spatially explicit nature risk assessment tools (the Water Risk Filter and Biodiversity Risk Filter) - can support.

In January 2023, the EU Corporate Sustainability Reporting Directive (CSRD) came into force. This directive establishes new rules on the Environmental, Social, and Governance (ESG) information that companies and financial institutions are required to publicly disclose within their sustainability reports, with a particular focus on the impact of their activities on people and environment.

These rules are intended to provide stakeholders, such as investors, regulators, consumers and the general public, with the information needed to understand organizations’ ESG impacts, and sustainability-related financial risks and opportunities for companies.

Organizations that are subject to the CSRD will have to report according to the European Sustainability Reporting Standards (ESRS), which lay out what organizations have to disclose and how. The first set of sector-agnostic ESRS for large firms were adopted in July 2023, covering disclosure requirements on corporate governance, strategy and business model and on a wide range of environmental, social and governance topics. The sector-agnostic ESRS include five environmental standards: Climate change (E1), Pollution (E2), Water and Marine Resources (E3), Biodiversity and Ecosystems (E4), and Resource Use and Circular Economy (E5).

CSRD and ESRS will be implemented in multiple stages. Large public interest entities already subject to the Non-Financial Reporting Directive must publish CSRD-compliant reports in 2025 (based on 2024 data). This will be followed by non-listed EU companies (2026), listed small and medium sized enterprises (2027), and finally non-EU companies operating in the EU (2028).

The WWF Risk Filter Suite (WWF RFS) can help companies and financial institutions prepare the disclosure requirements for CSRD reporting.

Designed to be used as corporate- and portfolio-level screening and prioritization tools with almost 100 global datasets on water and biodiversity, the WWF RFS’s tools enable companies and financial institutions to assess location-specific nature-related risks across their operations, supply chains and investment and financing activities worldwide.

The results from the biodiversity and water risk assessments can help to better inform business strategies, investment decisions, and target setting and disclosure efforts, thereby strengthening business resilience as well as contributing to a more sustainable future.

The WWF RFS tools also help companies and financial institutions to understand their dependencies and impacts on nature. They are aligned to and support key global initiatives and reporting frameworks such as the Taskforce on Nature-related Financial Disclosures (TNFD), Task Force on Climate-related Financial Disclosures (TCFD), Science Based Targets for Nature (SBTN), Alliance for Water Stewardship (AWS), CDP (formerly Carbon Disclosure Project), Global Reporting Initiative (GRI), and the European Sustainability Reporting Standards (ESRS).

For ESRS in particular, the RFS tools are well-equipped to support users on the impact, risk and opportunity management component of the standards, and provide partial support for the metrics and targets as well as the strategy component. In addition to this technical guidance on  ESRS, technical guidance documents have also been published explaining how RFS can support SBTN and TNFD (the documents can be found in the Data & Method section of the RFS).