Impact assessment in the CSRD

The impact assessment in the CSRD (Corporate Sustainability Reporting Directive) is a central part of how companies disclose their effect on the world around them. The directive requires in-scope companies to report on their environmental, social and governance (ESG) impacts, and the carbon footprint is one of the most important data points in that assessment.

This article explains what the CSRD impact assessment involves, how it connects to the carbon footprint, and how the scope of the rules changed following the EU's 2026 simplification package.

What is the CSRD?

The CSRD is an EU directive that improves the transparency and comparability of the sustainability information companies disclose. It replaced the earlier Non-Financial Reporting Directive (NFRD) and is built around reporting standards known as the European Sustainability Reporting Standards (ESRS).

What are the objectives of the CSRD?

• Provide comparable and reliable sustainability information to investors and other stakeholders.
• Integrate sustainability into corporate strategy and governance.
• Support sustainable investment and the transition to a more sustainable economy.

Which companies are affected? (2026 update)

The scope of the CSRD was significantly narrowed by the Omnibus I simplification. Directive (EU) 2026/470, published in the Official Journal on 26 February 2026 and in force from March 2026, raised the thresholds so that the directive now applies mainly to large EU companies that exceed both more than 1,000 employees and more than 450 million euros in net turnover. An earlier "stop the clock" directive (Directive (EU) 2025/794) had already postponed reporting deadlines for some companies.

For non-EU groups, the CSRD applies where they generate more than 450 million euros of net turnover in the EU and have an EU subsidiary or branch above the corresponding size threshold. Companies that fall below the new thresholds are no longer required to report for financial years starting on or after 1 January 2027. Because the framework keeps evolving, companies should check the latest national transposition and effective dates.

Double materiality and the carbon footprint

A defining feature of the CSRD is double materiality: companies assess both how sustainability matters affect the business (financial materiality) and how the business affects people and the environment (impact materiality). The carbon footprint is central to this, and the directive requires reporting of greenhouse gas emissions across Scope 1, Scope 2 and Scope 3.

• Scope 1: direct emissions from sources the company owns or controls (for example boilers and vehicles).
• Scope 2: indirect emissions from purchased electricity, heat or steam.
• Scope 3: other indirect emissions across the value chain, such as purchased goods, business travel and the use of sold products.

The ESRS themselves are being revised to cut the number of mandatory datapoints substantially, with a simplified set expected to apply from later financial years; the 2023 ESRS remain the legal reference until the revised standards are adopted.

Benefits of the CSRD impact assessment

• Regulatory compliance: meeting EU requirements and avoiding penalties.
• Reputation: demonstrating a credible commitment to sustainability.
• Access to finance: easier access to sustainable finance and responsible investors.
• Risk and opportunity: identifying climate-related risks and opportunities, from rising carbon costs to demand for sustainable products.
• Innovation and efficiency: driving more sustainable products and processes, often with cost savings.

How to approach the CSRD impact assessment

1. Understand the requirements: get familiar with the directive, the ESRS and the reporting obligations that apply to your company.
2. Run the double materiality assessment: identify which impacts, risks and opportunities are material.
3. Collect data: gather complete data on Scope 1, 2 and 3 emissions, which usually means engaging suppliers and value-chain partners.
4. Calculate the carbon footprint: use recognised methodologies such as the GHG Protocol.
5. Set targets and action plans: define reduction targets and concrete plans to meet them.
6. Integrate and report: embed sustainability into strategy and disclose progress transparently.

At Manglai we help companies measure their carbon footprint and prepare their CSRD sustainability reporting. Discover how Manglai can help you.