Entry into force of the Corporate Sustainability Reporting Directive

12 February 2024

Entry into force of the Corporate Sustainability Reporting Directive

The European Union introduced the Corporate Sustainability Reporting Directive (CSRD) to establish a new benchmark in non-financial reporting.[1] France has become the first EU Member State to transpose the CSRD into national legislation through Order No. 2023-1142, issued on December 6th, 2023.

The CSRD signifies an important leap from its predecessor, the Non-Financial Reporting Directive (NFRD), which had been adapted in France to create the DPEF (Directive de Performance Extra Financière).

The CSRD aims to enhance the transparency and consistency of sustainability reporting across the EU by broadening reporting requirements for a wider range of companies. Such measures should allow a better understanding of a company's impact on society and the environment.

The implementation timeline for the CSRD will be gradual starting on January 1st, 2024. Initially, the reporting obligation will concern companies already under the NFRD, followed by the inclusion of a broader number of companies as outlined in the following schedule:

  • For financial statements for 2024 fiscal year, applicable to large EU undertaking entities already under the NFRD, meeting the following criteria: >500 employees or >€40M net turnover and/or >€20M of total balance.
  • For financial statements for 2025 fiscal year, applicable to companies that are not currently subject to NFRD which meet at least two of the following criteria: >250 employees, >€40M net turnover and >€20M of total balance.
  • For financial statements for 2026 fiscal year, with possibility to postpone for two years, applicable to small and medium-sized enterprises listed on the stock exchange, except microenterprises which are companies with <€700K net turnover, <€250K of total balance and 10 employees during the financial year.
  • For financial statements for 2028 fiscal year, applicable to non-European companies with an EU-established large subsidiary or a listed SME subsidiary having >€150M net turnover for each of the last two consecutive financial years; or with a branch having a >€40M net turnover.

The scope of the information

The French Commercial Code, under Article L. 232-6-3, mandates companies to disclose information offering an understanding of their impact on sustainability matters, which includes environmental, social, and corporate governance considerations.

The provisions go beyond the previous French Extra-Financial Performance Declaration (EFPD). To adhere to the “double materiality” principle outlined in the CSRD, companies must ensure the reliability, comparability, and accessibility of the sustainability information. This involves addressing both the impact on the economy, environment, or society and the material financial repercussions on the company’s development, performance, and position.

To meet these requirements, the French Order and Decree[2] provide a detailed breakdown of the sustainability information that falls under the reporting scope:

  • Business model and strategy: Evaluation of the company's resilience to sustainability-related risks, identification of opportunities arising from sustainability considerations, and disclosure of plans, actions taken or contemplated, and associated financial and investment plans to align the business with sustainable economy goals.
  • Stakeholder considerations: An explanation of how the business model and strategy incorporate stakeholders' interests, and insights into the company's approach in implementing its strategy concerning sustainability issues.
  • Time-bound sustainability objectives: Clear delineation of objectives and progress towards achieving them, including emission reduction targets for 2030 and 2050.
  • Corporate governance and policies: Description of the role of management bodies in addressing sustainability issues; overview of the skills and expertise of board members in sustainability matters; outlining the company’s policies on sustainability issues.
  • Due diligence and negative impacts concerning sustainability matters and an identification and mitigation of potential or actual negative impacts on the company’s operations and value chain. However, companies may omit during the first three years from their reports data related to their value chains.
  • Risk management: Identification and management of sustainability-related risks and dependencies.


The CSRD brings stronger expectations toward companies through the significant changes to the information to be disclosed, and the number of companies required to share (and therefore collect) their climate related data. According to the adopted thresholds, around 50,000 companies in Europe will have to disclose climate information, compared to around 12,000 at present.

[1] Directive (EU) 2022/2464 of December 14, 2022 (CSRD directive), published in the Official Journal of the EU on December 16, 2022 applicable from January 1, 2024

[2] Decree No. 2023-1394 of December 30, 2023, implementing Ordinance No. 2023-1142 of December 6, 2023 on the publication and certification of sustainability information and the environmental, social and corporate governance obligations of commercial companies

Jacques Bouyssou & Juan Diego Niño-Vargas