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CSRD

Preparing for CSRD Reporting: How K2 Accountancy Group Can Support Your Business

As new Corporate Sustainability Reporting Directive (CSRD) regulations come into effect, businesses are facing heightened scrutiny over their sustainability reporting. Recent analysis by Deloitte has revealed that nearly half of FTSE 100 companies restated their climate and sustainability disclosures, with greenhouse gas (GHG) emissions accounting for 89% of those adjustments. The changing landscape highlights the growing complexity and importance of accurate, transparent sustainability data. K2 Accountancy Group is here to help small and medium-sized enterprises (SMEs) navigate these challenges and ensure compliance.

Why CSRD Matters to Your Business

CSRD will soon require businesses to report a wide range of environmental, social, and governance (ESG) metrics, starting from financial years beginning on or after January 1, 2024. Companies need to be prepared for deeper scrutiny from investors, regulatory bodies, and other stakeholders. Katherine Lampen, Deloitte’s Climate and Sustainability Lead, stresses that accurate and transparent sustainability reporting is not only good practice but is becoming a business imperative.

Boards and audit committees are increasingly focused on the reliability of non-financial disclosures. Lampen warns that climate risks need to be fully integrated into a company’s overall risk management approach, a task that many firms are still struggling with. She also notes that transparency, especially when restating previous disclosures, is essential to avoid accusations of greenwashing.

At K2 Accountancy Group, we understand the growing importance of aligning sustainability reporting with financial disclosures. By working closely with finance functions, we help companies develop more robust ESG data collection, reporting frameworks, and compliance strategies to meet evolving regulatory demands.

Avoiding Greenwashing and Achieving Transparency in CSRD

One key challenge businesses face is setting realistic sustainability targets and reporting progress accurately. Many companies announced ambitious net-zero targets after COP 26, only to restate those targets later without clear explanations. This inconsistency creates reputational risks, and stakeholders are quick to identify these missteps. At K2 Accountancy Group, we can guide your business in setting achievable sustainability goals and creating transparent reporting processes to keep your stakeholders informed and confident in your sustainability strategy.

Our team advises on best practices to ensure that your company’s sustainability reports are credible, from ensuring accurate data on GHG emissions to tracking diversity and inclusion metrics. Whether you need help implementing clear record-keeping systems or integrating climate risks into your overall business strategy, we provide the insights needed to stay ahead of these challenges.

The Role of Finance and Sustainability Functions

One of the key insights from Deloitte’s report is the importance of collaboration between finance and sustainability teams. Chief sustainability officers are often overwhelmed by the volume of regulations and expectations placed on their roles. Working alongside finance and internal audit teams can strengthen sustainability data and ensure that reports meet the growing demand for transparency.

At K2 Accountancy Group, we facilitate this cross-functional collaboration to ensure that financial and sustainability goals are aligned. Our experienced accountants work with your teams to develop internal controls that streamline the collection and verification of ESG data. By building strong foundations in both financial and non-financial reporting, we help businesses reduce the risk of errors and ensure consistency across all reports.

CSRD

How K2 Accountancy Group Can Help with CSRD

As the landscape of sustainability reporting continues to evolve, K2 Accountancy Group is here to provide expert guidance. We specialise in helping SMEs prepare for the rigorous demands of CSRD compliance and the scrutiny that comes with it. Here’s how we can support your business:

  1. Sustainability Reporting Frameworks: We assist businesses in adopting the right sustainability frameworks, ensuring that all ESG metrics are aligned with CSRD standards and reported accurately.
  2. Integration with Financial Reporting: Our experts ensure that sustainability and financial disclosures are integrated, reducing discrepancies and building a unified reporting approach.
  3. Risk Management and Climate Integration: We help your business identify and assess climate risks, integrating them into your overall risk management strategies for a more comprehensive approach to business sustainability.
  4. Audit and Assurance: K2 Accountancy Group provides internal audit services to help you assess the reliability of your sustainability data and processes, ensuring compliance with both current and forthcoming regulations.
  5. Stakeholder Communication: We guide businesses in transparent communication strategies to ensure stakeholders are well-informed about sustainability targets, achievements, and any necessary restatements.

Accountants Changing the World

As Richard Spencer, ICAEW Director of Sustainability, recently noted, accountants are playing an increasingly critical role in embedding reliable sustainability information into decision-making and disclosure processes. The skills that ACA-qualified accountants bring to financial reporting are now just as crucial in the ESG space.

At K2 Accountancy Group, we are proud to help businesses take this next step in their sustainability journey. Our team’s expertise in financial reporting, risk management, and ESG strategy means that we are perfectly positioned to support SMEs in navigating the complexities of CSRD compliance and broader sustainability initiatives.

If you want to ensure that your sustainability data is as robust and transparent as your financial reporting, contact us at K2 Accountancy Group today. We’re here to help your business stay compliant, avoid reputational risks, and embrace the opportunities presented by a more sustainable future.