Reputations are now at stake for brands connected to greenwashing, unsustainable practices, human rights violations, and excuses to do little to nothing on sustainability. For businesses wanting to protect their reputations and maximize their potential, it is vital to be accountable and transparent.

Intensified scrutiny on sustainability will add pressure to businesses in the European Union with the recent Corporate Sustainability Reporting Directive (CSRD) adopted into law by the European Council on the 28th November 2022.  New rules will need to be implemented by member states, which means that: 

1. More companies will soon be subject to strict sustainability reporting obligations including companies incorporated in the EU, those listed on an EU regulated market, or even non-EU organizations but have a significant presence and turnover in the EU.  The rules will begin applying:

– For large public-interest companies with over 500 employees from January 2025

– For companies with more than 250 employees or €40 million in revenue from January 2026

– For listed SMEs from January 2026

While very small companies are not yet subject to CSRD, they may also find themselves expected to voluntarily report according to CSRD standard by their stakeholders.

2. More detailed, standardized, quality reporting will be required to give investors and stakeholders access to information that is relevant, comparable and presented in a consistent format.  Companies will have to report on how their business model affects their sustainability and on how external factors, such as climate change or human right issues, influence their activities. 

3. A new independent audit requirement will be introduced to ensure and improve the reliability of sustainability information and data about a company’s environmental and societal footprint would be publicly available.  CSRD will create an independent assurance network which will operate in the same manner as the statutory audit of financial information, placing both at a level footing in terms of importance and reliability. 

Many hotels and tourism facilities are not ready for the new directive. Many have not prioritised rigorous sustainability in their business plans and operations. Many have chosen to focus on small scale actions or creative PR.  

Its vital for owners, operators and employees to urgently change their attitudes and behavior around sustainability, accountability and transparency.  CSRD requirements will be rigorous. For example, most hotel supply chain approaches today inform suppliers on their Code of Conduct with little to no Due Diligence and no yearly checks. The incoming directive will require ESG to be embedded into extended supply chains with a Code of Conduct, Due Diligence and an annual audit of the supplier operations, then the information will have to be digitally tagged and submitted into the European single access point.

It is crucial to have a science-backed sustainability certification programme, establish timelines for science-based targets according to recent UN Climate Reports, build knowledge capacity with extensive training, action an energy transition strategy, communicate transparently to engage the support of all stakeholders, and arrange an independent expert audit to ensure that the data and information collected is valid, correct, and accountable. This will take 2-3 years.

All companies need to start now to review and identify gaps in existing strategies and policies, monitoring process and management systems, corporate governance and business culture.  It is important to be prepared early, conduct a risk assessment, determine deficiencies and critical areas for improvement. It is also likely that more countries will follow the EU’s rigorous CSRD example in the years ahead.

However, according to a Climate Focus survey, a lack of knowledge, resourcing, complexity, and cost have been identified as internal barriers to achieving the environmental targets in the overall ESG approach by 93% of sustainability leaders surveyed.  While sustainability commitments have grown in number and ambition, many are struggling to take responsibility for their total impacts and implement their certification programme criterias, and executing plans to achieve their carbon targets is far from the core competency for most organizations.

It Must Be NOW exists to make it easier for hotels, tourism facilities and education establishments to advance sustainability, meet reporting obligations and achieve Climate Positive with accountability and transparency. We offer the NOW Climate Positive Programme & Award, a project cooperation with EarthCheck (the world’s leading science-backed certification Programme for sustainable hotels and tourism) and the owner of Carbon Offset Projects. This offer provides a fully funded Integrated Sustainability Programme with extensive training and support, and access to carbon credits with capped pricing to control risk for up to 10 years. View HERE.