In recent years, the topic of ESG (Environmental, Social, Governance) has gained considerable importance. Companies are under increasing pressure to evaluate and improve their business practices not only financially, but also in terms of their social and environmental impact. However, it is not only the new laws and guidelines that are driving this, but also the awareness and demand of consumers and customers has changed significantly. Greater transparency not only helps companies to comply with the guidelines, it also forms a new basis for competitive advantages.
Current status of ESG
ESG criteria are now an integral part of company valuation and management. Investors, customers and other stakeholders expect companies to disclose and improve their ESG performance. Dabei stehen drei Hauptbereiche im Fokus:
- Environmental : This is about the use of natural resources, emissions, waste management and the contribution to combating climate change.
- Social (Social): This includes aspects such as working conditions, human rights, health and safety as well as relationships with employees, suppliers and society.
- Governance (corporate governance): This includes corporate ethics, transparency, board structure, anti-corruption and compliance with legal regulations.
Existing rules and guidelines
In Europe, there are already a large number of guidelines and laws that regulate ESG reporting and measures:
- Non-Financial Reporting Directive (NFRD): This EU directive requires large companies to disclose non-financial and diversity information.
- EU Taxonomy Regulation: A classification system designed to help companies identify sustainable activities.
- Sustainable Finance Disclosure Regulation (SFDR): This regulation obliges financial market participants to create transparency about the consideration of sustainability risks in their investment decisions.
Upcoming rules and guidelines
The regulatory framework is being further expandedDer regulatorische Rahmen wird weiter ausgebaut:
- Corporate Sustainability Reporting Directive (CSRD): This new EU directive is intended to replace the NFRD and significantly expands reporting obligations. Sie wird ab 2024 stufenweise eingeführt.
- EU Green Bond Standard: A voluntary standard to help companies issue green bonds in line with the EU taxonomy.
- New provisions in the German Supply Chain Act: From 2023, the Supply Chain Act has been tightened up, obliging companies to check their entire supply chain for human rights and environmental standards.
Impact on the day-to-day work of controllers
Data integration and analysis, reporting, internal communication
Controllers play a central role in ESG reporting, as they are the ones who have to collect ESG data and integrate it into existing financial reports. In doing so, controllers must ensure accuracy and completeness. They are responsible for preparing ESG reports that meet both regulatory requirements and stakeholder expectations. Controllers act as a link between different departments to ensure that all relevant data is collected and reported correctly.
Possible distribution of tasks between the departments
- Sustainability department: Responsible for the strategic direction and implementation of ESG initiatives.
- Finance department: Integrates ESG data into financial reports and ensures compliance with regulatory requirements.
- Risk management: Identifies and assesses ESG risks and develops measures to minimize risks.
- Human Resources: Responsible for social aspects such as working conditions and diversity.
The role of the controller in ESG reporting
Controllers should see themselves as an integral part of the ESG team. Ihre Kernaufgaben umfassen:
- Data management: Ensure that all ESG data is collected, validated and integrated into reports.
- Collaboration: Work closely with other departments to ensure all aspects of ESG are covered.
- Continuing education: Keeping up to date with new regulatory requirements and best practices in ESG reporting.
Proactivity is required
The importance of ESG will continue to grow. Companies that proactively integrate ESG criteria and report on them transparently will be more competitive in the long term. Controllers are key players here, contributing to the sustainable success of the company through precise reporting and strategic analyses.
Integrating ESG into everyday working life requires a holistic approach and cooperation between different departments. Controllers should rise to this challenge and use their role as an interface and data expert to support the company on its path to greater sustainability.
Corporate Planner provides controllers and finance teams with software that supports them in the broad field of operational and strategic controlling. From data entry to the finished report, our software solution supports you in managing your company with more than 300 business management functions. This gives you more time to adapt to changes and react quickly.
