The EU’s Corporate Sustainability Reporting Directive (CSRD) promised a new era of transparency and comparability in sustainability reporting. But as the first wave of CSRD-aligned reports emerges in 2025, the reality is proving more complex. Some companies are racing ahead with detailed disclosures, while others are taking a minimalist approach. Investors? Many are struggling to make sense of it all.
We’re only at the beginning of the CSRD journey, but the early lessons are already clear: The gap between reporting ambition and data quality is widening. And the path forward may be shaped as much by simplification as by regulation.
Early CSRD Reporting: A Diverse Landscape Takes Shape
Since early 2025, over 250 companies have published sustainability reports aligned with CSRD — with report lengths ranging from 30 pages to over 300. One striking takeaway: The number of sustainability-related Impacts, Risks, and Opportunities (IROs) disclosed varies dramatically. Some companies report on fewer than 15 IROs. Others disclose more than 80. This variation highlights not only the complexity of CSRD implementation but also differences in how companies interpret their reporting obligations — and their readiness to meet them.
A PwC analysis shows that 90% of the first 100 CSRD reports came from just five European countries, including Germany, Spain, and the Netherlands, none of which have yet transposed CSRD into national law. Why report early? The answer is clear: mounting pressure from investors, regulators, and other stakeholders demanding greater transparency on sustainability performance.
But just as the first reports hit the market, uncertainty looms. The European Commission’s February Omnibus package could remove up to 80% of companies from the directive’s scope — a move that may significantly reshape the reporting landscape.
Data Quality: The New Focus Area for Reporting and Investors
At the heart of CSRD reporting lies the double materiality assessment, a process that requires companies to disclose sustainability matters that affect both enterprise value and broader environmental and social impacts. But execution varies widely.
According to PwC, while nearly all companies engage with internal stakeholders during the materiality process, few provide detailed information about engagement with external stakeholders.
The most commonly reported topics include:
- Climate Change (mitigation, adaptation, energy use)
- Workforce Conditions (employee well-being, labor practices)
- Business Conduct (ethics, anti-corruption measures)
As PwC notes, the goal is to help companies and stakeholders “understand more clearly the interplay between sustainability and value creation.” But when reporting approaches differ so dramatically, comparison becomes difficult, leaving investors to navigate a patchwork of methodologies and disclosures.
Investor Reactions: Cautious Optimism Meets Complex Disclosures
As Responsible Investor has reported, some investors have already voiced their concerns.
Sondre Myge, head of ESG at Skagen Funds, said that while it’s still early, his “first impression is that it complicates comparability. Investors are now drowning in a mix of voluntary and legal disclosures requiring them to make assessments through a kaleidoscope of standards and methodologies. Sifting critically through hundreds of pages of text just for one company is a huge undertaking. While first movers will provide glossy reports that convey a convincing impression, it is important to remember that disclosures are not necessarily representative.”
Jan Kaeraa Rasmussen, head of ESG and sustainability at PensionDanmark, agreed, stating that initial disclosures tend to be “more narrative than quantitative. This limits our ability to draw robust, forward-looking insights from the information provided.”
What’s Next: Simplification or More Complexity?
Despite these challenges, the direction of travel is clear: sustainability reporting in the EU is becoming more structured, more transparent, and more data-driven. But we are still in a period of transition.
Companies are building internal systems and capabilities to support CSRD compliance. Best practices are only now emerging. And regulatory changes, like the proposed Omnibus package, could dramatically alter the scope of reporting obligations.
For investors and stakeholders, the challenge will be to sift through early reports critically, distinguishing between narrative-heavy disclosures and data-rich insights that can drive better decision-making.
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