Sustainability Regulation as a compliance trap leading to the opposite than the intention.

No csrd

Congratulations — you’re not in scope of the Corporate Sustainability Reporting Directive (CSRD) 🥳

But: use this freedom wisely. Instead of ticking boxes or blindly following the VSME standard, you can design a sustainability management that is fit-for-purpose, future-proof, and value-creating.

Done right, this will:

  • protect you from tactical mistakes your larger peers already made,

  • prepare you to respond confidently to external requests,

  • and position you competitively with strong, business-savvy arguments.

👉 Want to know what works best for your organization?

Book a future-readiness call

who this is for

For CEOs, CFOs, boards, sustainability leaders, finance teams, and investors who want future-fit strategies — without compliance standing in the way.

Our five-step Future readiness approach

What we do

We run a materiality assessment grounded in impact data, combining primary data with estimates and stakeholder input where useful and pair it with a high-level identification of the main risks and opportunities (IRO). If you want a more granular view, we perform a targeted deep-dive on selected topics or revisit the results after STEP 2.

Outcome

A short, defensible materiality report that defines the list of material topics and prioritizes where to focus data collection and controls.

What we do

For each material topic we design pragmatic data collection, combining proprietary AI tools with available IT systems, source mapping and calculation rules (aligned with useful requirements), and run the required quantification so figures are auditable and traceable. We also finalize the risk & opportunity assessment with quantified inputs.

Outcome

A documented dataset and audit trail, plus quantified risk/opportunity inputs that feed reporting tables and financial analysis. Optionally complemented by a forecast. 

What we do

We prepare concise board materials that translate impacts and quantified risks into target options (ambition levels, KPIs, timelines) and a clear recommendation for board approval.

Outcome

Board-approved targets and an approved disclosure direction that align ambition with strategic risk tolerance and capital planning.

What we do

We specify what must change in governance, internal controls, data flows, and financing to operationalize the decisions and targets set by the top management— for example: board oversight clauses, internal reporting KPIs, assurance controls, and ESG-linked financing triggers. We design the operating model to become future proof and decision quality in a way that fits the chosen strategy.

Outcome

A fit-for-purpose governance model, reporting processes and a prioritized implementation roadmap. (This is where Impact and Value & Risk outputs become operational inputs.)

What we do

We convert technical outputs into consistent internal communication packs and external disclosures (reporting tables, management narrative, investor Q&A). We also can support you in the assurance process and communications plan to reduce investor friction.

Outcome

Fit-for-purpose, audit-ready disclosures and a clear external story that protects credibility and supports capital and commercial objectives that is consistently following a clear strategy

Each organization is different. We quickly understand where you are and what the next steps forward are.

Request a future-fit propsal

The pitfalls of an only-compliance approach (e.g., to the VSME)

 
We have witnessed to us that their NFRD report (successor of the CSRD) was "Only PR", meaning that the communicated impression was not mirrored by general business processes, activities and decisions. While the ESRS are being currently updated, it can be expected that such approaches will become more difficult to follow. However, the main pitfall is a different one: Imagine the employees finding out that the sustainability reporting is "Only PR"? The likelihood of this having a negative impact on the culture of the organization is high, with potential new risks in the field of bribery and corruption.
The complex, not always logical and partially inconsistent regulatory requirements could lead to inconsistent management approaches that only cost time and money. We have identified five different strategies (approaches) why the investments into a sustainability management could make business sense, along with five different ways of implementation. Any approach that lacks a clear strategy is doomed to produce only costs and time lost. 
Finally, being lost in translation could lead to two extremes:1. Doing everything that needs to be done to make the auditor happy and comply 2. Misunderstanding the compliance exercise and applying a strategy that does not fit the business model, risk and opportunity profile of the organization The first one may lead to missed opportunities and overlooked business risks and the second one to overhead costs that lack respective returns.

Pitfall 1 “Only PR”

We have seen companies treat their NFRD report (predecessor of the CSRD) as “Only PR”, meaning that the communicated impression was not mirrored by general business processes, activities and decisions. While the VSME and for some of your customers the ESRS are being currently updated, it can be expected that such approaches will become more difficult to follow. However, the main pitfall is a different one: Imagine the employees finding out that the sustainability reporting is “Only PR”? The likelihood of this having a negative impact on the culture of the organization is high, with potential new risks in the field of bribery and corruption.

Pitfall 2 Inconsistent Approaches

The not always logical and partially inconsistent requirements of the VSME could lead to inconsistent management approaches that only cost time and money. We have identified five different strategies (approaches) why the investments into a sustainability management could make business sense, along with five different ways of implementation. Any approach that lacks a clear strategy is doomed to produce only costs and time lost. 

Pitfall 3 No or the wrong Strategy

Finally, being lost in translation could lead to two extremes:
1. Doing everything that needs to be done to make the auditor happy and comply even to a voluntary standard

2. Misunderstanding the voluntary compliance exercise and applying a strategy that does not fit the business model, risk and opportunity profile of the organization

The first one may lead to missed opportunities and overlooked business risks and the second one to overhead costs that lack respective returns.