The allure of sustainability reporting lies in diverse company-wide involvement

If you want to report on sustainability, you need to work on a well-thought-out data & reporting strategy and outline the necessary processes, according to Peter Van den Spiegel of KPMG in Belgium and Veronique Toully of UCB.

It goes without saying that companies must publish their financial results every year. For large corporations, there's an additional annual task on the horizon. Europe is mandating them to report on sustainability in the broadest sense.

“The Corporate Sustainability Reporting Directive (CSRD) includes more than 300 data points that are relevant to companies. Those data are spread across the three ESG pillars: environment, social and governance,” says Peter Van den Spiegel, Partner, and Head of Lighthouse at KPMG in Belgium. “Through a double materiality assessment, a survey of internal and external stakeholders, companies should identify their main focus points.” 

Depending on the outcome of the exercise, the number of data points on which to report can easily reach 150.

For some companies, resource scarcity will be an important topic, while others will have to report primarily on how they avoid human rights violations. “Determining those topics is just a first step. The real challenge is collecting the data. Not only do companies have a lot of data to report on, data are also scattered throughout the organization. Consequently, teams must work together to achieve the desired results,” says Van den Spiegel.

Such is the case at pharmaceutical company UCB, where Veronique Toully plays a key role in the CSRD exercise as Global Head of Sustainability, Corporate Affairs and Risks. “We have been reporting for years on most of the topics that came up in our recent double materiality assessment, but the way we approach it is different now. We report on all relevant aspects, such as ethical behavior and environment. But the social aspects, headed by access to medicines, are key for us. The beauty of the CSRD is that a large part of the company must be involved. In our case, this includes people involved in the development and commercialization of our medicines, finance, IT, HR, and procurement.

There was already a substantial amount of information available at UCB, but in-depth analysis made it clear what was still missing or not appropriately structured. In contrast to financial data, which is typically held in a relatively small number of interconnected systems, ESG data often needs to be collected from a plethora of diverse systems. This poses a challenge because auditors want to understand how a specific output can be traced back to the original source, enabling them to verify the accuracy of the calculation.

“Using the right technology is essential to efficiently and effectively carry out the required data collection, calculation, and reporting. Experience shows that it is impossible to tackle everything at once. Taking a phased approach is recommended, considering the maturity of the organization in data management, the importance of certain data points, and the balancing of costs and benefits in automation,” Peter points out.

"We still get our data from different systems, but are working on an integrated platform," Toully says. Apart from the tools, processes are also crucial. “The processes continually evolve in tandem with the business strategy. The CSRD is not just about reporting, it’s also about how companies adapt their actions to create a positive impact on society. It makes sense to involve everyone in this process.”

This article was created in collaboration with De Tijd and L'Echo.