Building your CSRD team

Insights from Watershed and TIP Group on how to foster successful collaboration on CSRD reporting.

CSRD experts on how to build a team to complete CSRD reporting

The extensive requirements of the EU’s Corporate Sustainability Reporting Directive (CSRD) mean that compliance must be a company-wide effort for every business that’s impacted.

For the person tasked with leading this effort, this means clearly translating CSRD requirements into meaningful action points and securing buy-in on these action points from every stakeholder.

“What is the risk if you don’t do this? Confusion. Confusion will lead to inefficiencies. Confusion will lead to miscommunication. And eventually, this team that you’re trying to build to tackle the CSRD will fail,” says Markus Pretzl, who, as Director of ESG and EHS, is currently leading CSRD efforts at TIP Group, a major European equipment services provider.

Pretzl sat down with Watershed CSRD experts Katie Sidell and Naina Khandelwal to discuss how this works in practice, covering everything from who should be involved, to the best ways to engage different stakeholders (both internal and external) during the CSRD process.

Here are their top tips:

Which team should be responsible for the CSRD report?

Sidell and Khandelwal observed that the two most common teams they see owning the CSRD process are ESG/Sustainability and Finance. Choosing between these depends on the specifics of your company.

Many businesses, including the TIP Group, assign CSRD ownership to the ESG team. For Pretzl, this is a logical choice: “In our case, the ESG team is taking the lead on [the CSRD], because we are capable of translating the ESRS [European Sustainability Reporting Standards] into specific data reporting requirements that are understood internally.”

Given the depth of reporting involved in the CSRD, the finance team may also be a good fit to own the overall report, suggests Sidell. “They already have a relationship with assurance providers and have experience with other mandatory disclosures.”

Additionally, given the serious financial risk of non-compliance fines, some CFOs and Finance teams may feel they’re best placed to manage the process.

“If finance does own the overall CSRD process, they’ll most likely need an ESG specialist working closely with the team to advise on terminology and best practices,” says Sidell. Some companies Sidell has worked with have restructured their organization so sustainability becomes part of the finance team.

CSRD ownership also occasionally sits with legal, data analytics, communications, and even procurement.

How to engage each stakeholder group in CSRD reporting

Regardless of which team is responsible, they’ll have their work cut out for them in building collaboration and alignment across the entire organization. The good news, Pretzl points out, is that the structure of the CSRD process itself “builds a funnel”—guiding the team to onboard internal and external stakeholders into the process step by step.

Pretzl shared some collaboration strategies specific to each group of stakeholders in the CSRD funnel:

1. The leadership team

“If you don‘t get the buy-in of the senior leadership, then you won't be successful in such a cross-functional corporation,” says Pretzl. “Getting executives like CFOs on board can really unlock all these other teams‘ involvement.”

Engage your leadership team by:

2. Data owners

Once you’ve got your leadership team motivated, you need to involve the teams that own the data you’ll be reporting on, such as: HR, Legal, Compliance, Finance, Health and Safety, ESG, and Manufacturing.

Engage your data owners by:

If possible, Pretzl suggests, “Figure out the pain point of each specific team, and look for how you can connect that pain point to a data reporting requirement.”

3. Data transformers

Once you’ve identified and collected all your data, you’ll need to involve your business intelligence or IT team to prepare the data for the report.

Engage data transformers by:

4. Integrated reporting team

Once the data has been collected and transformed, you’ll need to connect with a final group of internal stakeholders—the reporting team. Whether finance, ESG, or communications prepare the final report, you should expect a lot of back-and-forth between all stakeholders as you go through the internal review process.

Engage the reporting team by:

5. External stakeholders

The CSRD requires close collaboration with external stakeholders, especially auditors and shareholders.

Engage auditors by:

Engage shareholders by:

If you’re in the process of preparing your first CSRD report, Watershed can help. Watershed for CSRD is purpose-built to help companies take control of sprawling data collection in a single, comprehensive platform.

To learn more about how your peers are building their CSRD teams and handling reporting requirements, consider applying to the CSRD Connect community.

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