Belgium and the CSRD: Key Updates and Implications for 2024

The Corporate Sustainability Reporting Directive (CSRD) has been introduced to transform corporate sustainability reporting in Europe. 

Replacing the Non-Financial Reporting Directive (NFRD), the CSRD imposes more rigorous and uniform regulations on businesses regarding their sustainability practices. 

This blog explores the current state of the CSRD in Belgium, its implications for businesses, and the steps taken to ensure compliance.

Overview of CSRD

The CSRD is a European Union law designed to improve transparency and accountability in corporate sustainability reporting. Its primary goal is to provide stakeholders - such as customers, legislators, and investors - with accurate, comparable, and reliable data on the environmental and social impacts of business operations. 

The rollout of CSRD in Belgium

Belgium has taken significant steps to implement the CSRD. At the end of 2023, the SPF Economy, alongside the SPF Foreign Affairs and SPF Justice, launched the procedure for integrating the directive into Belgian regulations. 

Who needs to comply?

Under the CSRD, approximately 2,800 businesses in Belgium are required to disclose detailed information about their social, political, and environmental impacts. Compliance involves reporting on opportunities and risks related to these issues, as well as the effects of their operations on the environment and human populations.

The National Bank of Belgium has identified the companies subject to the CSRD reporting standard based on the statutory annual accounts filed by December 31, 2022. These companies fall into three distinct groups:

1. Group 1: Large insurers and listed businesses

   - Criteria: Must meet at least two of the following thresholds:

     - 500 employees

     - €50 million in net income

     - €25 million in total assets

2. Group 2: Mid-sized businesses, lenders, and insurance providers

   - Criteria: Must meet at least two of the following thresholds:

     - 250 employees

     - €50 million in net sales

     - €25 million in total assets

3. Group 3: Small and medium-sized listed businesses, lenders, and insurers

   - Criteria: Must meet at least two of the following thresholds:

     - 10 employees

     - €900,000 in net revenue

     - €450,000 in total assets

Conclusion

The introduction of the CSRD marks a crucial development in the EU’s commitment to sustainability and transparency. For Belgian businesses, complying with the CSRD will require significant effort and adaptation. However, it also presents an opportunity to demonstrate leadership in sustainability, build stakeholder trust, and contribute to broader environmental and social goals.

As Belgium continues to roll out the CSRD, businesses should stay informed about regulatory updates and best practices for reporting. By doing so, they can navigate the complexities of the directive and position themselves as leaders in sustainable business practices.

ESG Flo can support Belgian businesses in meeting the CSRD requirements by streamlining the collection, management, and reporting of ESG data. Its platform integrates various data sources and automates the generation of compliance-ready reports, making it easier for companies to meet the directive’s detailed reporting standards. This efficiency helps businesses accurately disclose their environmental and social impacts, align with the CSRD’s rigorous requirements, and effectively communicate their sustainability performance to stakeholders.

Sources:

https://www.nbb.be/fr/articles/liste-des-entreprises-soumises-la-csrd

https://www.forbes.com/sites/jonmcgowan/2024/07/31/majority-of-eu-countries-have-not-adopted-sustainability-reporting-law/

https://www.crowell.com/en/insights/client-alerts/2024-an-overview-of-new-and-upcoming-belgian-and-eu-laws-and-regulations