As the planet gets warmer and emissions continue to rise, an expanding coalition of businesses, private and public institutions, and governments are pledging their cooperation towards creating a net-zero world.
While there are numerous goals to be met, what is particularly urgent is the reduction of greenhouse gases by 42% by the year 2030. China, the United States, India, the EU27, Russia and Brazil are the six largest greenhouse gas emitters. In 2022, together they accounted for 50.1% of the global population.
What is CSRD?
The CSRD is part of this wider effort to report emissions and tackle climate change. Is your company subject to these new rigors of sustainability reporting? It’s an EU directive which requires all large companies and listed SMEs in the EU, as well as many foreign companies, to report on sustainability impacts annually. The goal of CSRD is to make reporting on corporate sustainability commitments more transparent, measurable, and comparable.
Will CSRD affect corporate travel programs?
The main goal of CSRD is to provide transparency around:
- Companies’ material topics – which means companies need to identify their material sustainability impacts, risks and opportunities
- The measuring and reporting of progress
“Material topics” are those issues that are most relevant to a company’s business operations, such as governance, strategy, impact, risk/opportunity management, and metrics. To identify them, a double materiality assessment will be required which will include an assessment from a company’s financial point of view and an “impact on society” perspective.
Collecting sustainability data, as well as the methodology employed to measure it and report it, will take on a new level of significance. Most companies are likely to submit their Scope 3 emissions, which includes business travel emissions. This can include air, hotel, rail and car. In addition, depending on how important business travel emissions are to the company (i.e., if they are a very large proportion of the total carbon footprint), the company will have to set reduction strategies and targets related to business travel emissions.
The scope of CSRD includes small-, medium- and large-sized companies alike. While CSRD is an EU directive, its impact reaches far and wide and will affect foreign companies with significant business in the EU.
The CSRD timeline
CSRD rollout has been ongoing since 2024. The scope of the directive, and the number of companies it will affect, will expand over the next five years:
- 2024: EU listed companies with over 500 employees
- 2025: EU based large companies with 250 employees (Balance sheet of more than EUR 20M, Net revenue of more than EUR 40M)
- 2026: EU based SMEs and private companies with more than 10 employees (Net revenue of more than EUR 700K; more than EUR 350K in assets)
- 2028: non-EU companies with significant business in the EU will also have to report to CSRD (Net turnover of more than 150M in the EU, at least one subsidiary/branch in the EU)
- Suppliers are not excluded from CSRD initiatives. There will be increased demand for sustainability information from companies around the world who supply goods and services to CSRD-compliant companies.
- An estimated 60,000 companies or more worldwide could be impacted.
CSRD and managed travel: How do we even begin?
CSRD is a massive undertaking for companies that now have to meet stringent reporting requirements. For business travel managers, measuring and documenting data on travel emissions is now paramount. As deadlines under the CSRD approach, here are a few things that travel managers can jump start the process with:
- Find out if your company is even required to report CSRD? If so, when?
- What are the processes and timelines for collecting data?
- What data will be required?
- Will you be setting targets and a reduction strategy related to business travel specifically?
- What is the audit process?
- Will you work with an external sustainability partner/supplier? If so, do you need enhanced recommendations and/or a risk assessment? Or full reporting, strategy and target-setting support?
Don’t get caught off guard by CSRD in 2025
Many companies feel unprepared for the challenges of CSRD. According to BTN, only 51% of Europe-based travel managers responding to BTN Europe’s 2024 sustainability survey said they would be ready to report on CSRD requirements by January 2025.
Our sustainability offering aids compliance with CSRD which requires setting and monitoring progress against targets as well as basic CO2 reporting. Travel managers can set the parameters for their policy and track and report their progress.
For clients that desire sustainability strategy and change management support as well as more sophisticated analytics tools, BCD’s consulting division, Advito and their sustainability experts can help.
BCD’s first-of-its kind offering integrates sustainability into the entire travel management process
BCD partnered with SQUAKE, a leading climate-tech company, to streamline carbon emission related action across various industry tools and touchpoints. The result is a game-changing offering for BCD clients and prospects, making sustainable travel easier and more transparent for everyone involved. The offering helps customers prepare for CSRD by:
- Reporting on emissions and progress
- Setting sustainability goals and carbon targets
- Driving traveler behavior change
Applying carbon tax or allocate carbon emissions reduction and removal project costs at the point of sale
