Corporate ESG compliance

The focus on environmental, social and governance (ESG) issues, particularly regarding corporate responsibility for social and ecological impacts of economic activities is growing. This development is becoming significant for small and medium-sized entities (SMEs). The process is driven by an increasing number of legally binding regulations, which require the implementation of group-wide management processes to maintain compliance. This poses challenges for US subsidiaries of German and European SMEs in particular.

Our ESG expertise

Is important for companies to recognize that the topic of ESG is of growing importance and it is necessary to begin preparing in advance for the implementation of requirements. We see our role as auditors not only in the audit of your future ESG report, but above all in the concrete support of you, our client, in coping with the complex requirements of ESG. We at Rödl & Partner pay great attention to the topic of ESG and we are prepared and educated to support you.

Why it matters

ESG is becoming a key differentiator for companies in the global market. It not only impacts financial performance but also shapes a company's reputation and resilience in an increasingly complex and interconnected world. Organizations that prioritize ESG are often better equipped to navigate challenges, seize opportunities, and contribute to a sustainable future.

What is ESG?

ESG is a framework that evaluates a company's commitment and performance in three critical areas:

Environmental: How a company’s operations impact the environment. This includes factors like carbon emissions, waste management, resource use, and efforts to combat climate change.
Social: How a company manages relationships with employees, suppliers, customers, and communities. This includes issues like labor practices, diversity and inclusion, human rights, and community impact.
Governance: How a company is governed. This encompasses corporate governance practices such as board diversity, executive compensation, transparency, ethics, and shareholder rights.

Sustainability reporting on ESG under the Corporate Sustainability Reporting Directive (CSRD) is already effective for 2024 for large companies subject to reporting of the Non Financial Reporting Directive (NFRD). All other large companies and listed SMEs are required to report for 2025 and 2026, respectively.