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Large capital market-oriented companies and financial institutions are obliged for the first time to report on non-financial topics on an annual basis as of the 2017 financial year by the CSR Directive Implementation Act (CSR-RUG). This made the previously voluntary practice of sustainability reporting mandatory for certain companies.

In addition to a description of their business model, the companies affected by the CSR-RUG must at least report on environmental concerns, employee concerns, social concerns, respect for human rights and the fight against corruption and bribery. The required information relates to the concepts pursued and their results, significant risks and the most important non-financial performance indicators.

When implementing the CSR reporting obligation, companies concerned may publish non-financial information either as part of the management report ("non-financial statement") or in a separate form ("separate non-financial report").

If a non-financial statement is published as part of the management report, there is no right of choice regarding the publication date - the deadlines for the publication of the annual financial statements apply. If a separate non-financial report is chosen, companies must publish it no later than four months after the reporting date.

A special feature of the CSR-RUG is the supervisory board's obligation under stock corporation law to review the non-financial reporting. This presents supervisory boards with new challenges in terms of content. Many supervisory boards therefore commission an additional audit of the non-financial reporting with regard to compliance as well as the quality of the internal control system and the non-financial risk management.

KPMG supports companies in setting up their non-financial reporting, from conducting materiality analyses taking into account the statutory materiality formula, identifying, assessing, managing and reporting non-financial risks to developing measures, key performance indicators and targets with regard to material issues.

In addition, KPMG helps clients to dovetail sustainability issues into governance systems, in particular by developing the internal control system for non-financial information, integrating non-financial risks into existing risk management and building substantive sustainability expertise in internal audit.

As a market leader in the audit of sustainability information, KPMG also supports companies in the audit of non-financial reporting. Based on recognised standards, audits are carried out with both limited assurance and reasonable assurance and using relevant auditing standards (in particular ISAE 3000).

With comprehensive consulting and auditing services, KPMG supports companies in the further development of non-financial reporting and the fulfilment of the non-financial reporting obligation according to CSR-RUG, regardless of the maturity level of the sustainability systems, processes and disclosures.

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