Workiva Report Raises Concerns About CSRD Readiness Among EU Companies
17 Maio 2023 - 5:00AM
Business Wire
- Report shows the CSRD mandate is already having a major
influence on annual reporting
- Overwhelmed and over-capacity reporting teams underestimate the
work that lies ahead
- Integrated reporting will enable companies to optimise
processes and meet new CSRD demands
The majority (94%) of European organisations surveyed are
working to become compliant with the CSRD (Corporate Sustainability
Reporting Directive) by 2024, but their lack of decisive action is
putting them at risk of running out of time, according to a second
annual report by Workiva Inc. (NYSE:WK), the world’s leading cloud
platform for assured integrated reporting. Furthermore, as
reporting teams continue to accept and absorb an ever-increasing
workload, they are underestimating the volume of work that lies
ahead of the CSRD deadline.
CSRD influence on annual reporting
According to the Workiva report, “Annual
Reporting Barometer 2023: Facing up to the CSRD,” surveying
more than 500 finance leaders across Europe, 59 percent of
respondents that aren’t even required to comply with the CSRD are
still planning on doing so entirely voluntarily. The impact of the
CSRD is clearly being felt, with more than three quarters (77%) of
businesses surveyed revealing that ESG now has a moderate or major
influence over their annual reporting strategies. For 73 percent of
respondents in the DACH region and 67 percent in the UK and Ireland
(UKI), ESG now has a moderate or major influence.
Companies underestimate the work ahead
While European organisations are driving toward change, with 43
percent of respondents planning to spend about the same amount of
time as last year on financial transformation over the next 12
months, finance teams find themselves persistently accepting and
absorbing an ever-increasing workload, indicating a frustratingly
slow pace of progress. Over one third (37%) of respondents admitted
to feeling overwhelmed and exceeding their capacity during the
previous reporting period. In the UKI, companies felt the most
pressure, with 60 percent being over capacity. It comes as no
surprise that 41 percent asked for more time during next year’s
reporting period.
“The CSRD mandate is already having a significant impact on the
reporting landscape,” said Erik Saito, senior vice president and
general manager of EMEA at Workiva. “Many reporting teams are at or
near capacity and will be challenged by the workload pressure of
additional CSRD reporting requirements—including additional
disclosure, auditor assurance, and XBRL tagging—which will drive
many to leverage new technology solutions. Workiva has the ability
to help companies meet these complex regulatory requirements and
reduce the chaos surrounding reporting."
Collaboration is in the spotlight
Despite the CSRD mandate requiring companies to integrate both
financial and sustainability information into their annual reports,
only 10 percent of those surveyed are currently working to improve
collaboration between finance and sustainability. Similarly, only
10 percent are actively working on improving collaboration between
finance and risk, while a mere six percent are focused on
integrating finance, sustainability, and risk. UKI companies were
slightly ahead of Europe, at 12 percent—despite not necessarily
needing to comply with the CSRD—while DACH lags further behind, at
eight percent. This indicates that, while improvements are being
made, it’s not clear whether existing plans to optimise
collaboration between finance, sustainability, and risk to meet
CSRD demands are going far enough.
“There is a clear lack of in-depth understanding when it comes
to the requirements of integrated reporting—particularly in regard
to CSRD compliance and the timelines needed to establish, test and
optimise a truly cross-functional reporting structure,” continued
Saito. “Organisations simply won’t be able to approach CSRD
compliance with a ‘trial-and-error’ approach; the demands are far
more complex than anything that has come before—and will only
continue to increase.”
Optimise processes with technology
With the need to integrate finance and sustainability,
organisations need to rethink their existing processes and develop
a roadmap for incorporating both their financial and sustainability
(non-financial) data with audit and controls into their reporting
process. Indeed, finance reporting teams may be accepting of
current workloads, but if teams are working with largely manual
processes, they will struggle to absorb the shock of the CSRD.
Forty-six percent of respondents are actively integrating or have
already integrated tech into their reporting processes, with the
UKI and DACH ahead of Europe in this area, at 52 percent and 50
percent respectively.
“The CSRD is a north star for organisations and is changing
perceptions surrounding annual reporting—but companies are
unprepared and are not moving quickly enough to meet new demands,”
concluded Saito. “European companies may be ahead of the curve in
terms of incorporating ESG into annual reporting strategies,
however this is often because they have to be, rather than because
they are genuinely in control. Businesses must prioritise
cost-effective, efficient solutions as they work towards optimising
their processes.”
About the survey
Workiva commissioned an independent survey, undertaken by
Opinium Research, of 509 finance leaders who are responsible for
corporate reporting in publicly listed companies, the majority with
$50m+ annual turnover.
Respondents were surveyed between 13 March – 14 April 2023, and
resided in 14 European markets, including UK, Ireland, Spain,
Germany, Austria, Switzerland, France, Denmark, Norway, Sweden,
Finland, Belgium, Netherlands, and Luxembourg.
To download the full report, please click here.
About Workiva
Workiva Inc. (NYSE:WK) is on a mission to power transparent
reporting for a better world. We build and deliver the world’s
leading regulatory, financial, and ESG reporting solutions to meet
stakeholder demands for action, transparency, and disclosure of
financial and non-financial data. Our cloud-based platform
simplifies the most complex reporting and disclosure challenges by
streamlining processes, connecting data and teams, and ensuring
consistency. Learn more at workiva.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20230517005354/en/
Media: Rotha Brauntz Lauren Covello press@workiva.com
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