The CSRD was transposed into Irish law via the European Union (Corporate Sustainability Reporting) Regulations 2024, which amended the Companies Act 2014 and the Irish Transparency Regulations 2007.

Scope and Reporting Timeframe

CSRD reporting obligations apply to large Irish-incorporated companies (including holding companies who meet the requirements for a large company on a consolidated basis), issuers with debt or equity listed on an EU regulated market and Irish subsidiaries or branches of non-EU parent companies which exceed specified turnover thresholds.

Micro-companies, AIFs, UCITs, credit unions, friendly societies and non-EU issuers (without EU subsidiaries or branches) with exclusively wholesale debt securities listed on the regulated market of Euronext Dublin, are excluded from scope.

These obligations apply on a phased basis:

Reporting Timeframe	Entities in Scope
Phase 1: Financial years commencing on/after 1 January 2024	Large Irish-incorporated companies with more than 500 employees that are “public-interest entities”.	Large issuers with securities listed on an EU regulated market with more than 500 employees.
Phase 2: Financial years commencing on/after 1 January 2025	Large Irish-incorporated companies other than those in scope in Phase 1.	Large issuers with securities listed on an EU regulated market, other than those in scope in Phase 1.
Phase 3: Financial years commencing on/after 1 January 2026	Small and medium Irish-incorporated companies with securities listed on an EU regulated market.   Irish-incorporated small and non-complex institutions, captive insurance and reinsurance undertakings, that are large companies with securities listed on an EU regulated market.	Issuers with securities listed on an EU regulated market which are SMEs.   Issuers which are small and non-complex institutions, captive insurance and reinsurance undertakings which are large undertakings or SMEs with securities listed on an EU regulated market.
Phase 4: Financial years commencing on/after 1 January 2028	Irish-incorporated subsidiaries of non-EU parent companies with net turnover exceeding EUR150 million in the EU, where the subsidiary is an in-scope company.   Irish-incorporated branches of non-EU companies with net turnover exceeding EUR150 million in the EU, where the branch generated a net turnover of more than EUR40 million in the preceding financial year.

Sustainability Reporting

Sustainability reporting must be included, for each financial year, in a clearly identifiable dedicated section of the directors’ report. It is not permissible to prepare a separate sustainability report. The directors’ report must be prepared in single electronic reporting format with sustainability information ‘tagged’ in accordance with an XBRL digital taxonomy.

Information to be reported in relation to sustainability matters includes details of the business model and strategy, any timebound targets, polices, incentive arrangements, details of the due diligence process implemented and principal risks.

Sustainability information must be reported in accordance with European Sustainability Reporting Standards (ESRS) from a ‘double materiality’ perspective.

ESRS

The ESRS specify the disclosure requirements for sustainability information. The first set of ESRS apply across all industry sectors and are comprised of two cross-cutting standards and ten topical standards covering environmental, social and governance matters.

Further ESRS are currently being developed including sector-specific standards and standards for non-EU companies, which are due to be adopted by June 2026.

Double Materiality

Other than specified mandatory disclosures, disclosures in accordance with the ESRS are subject to a materiality assessment from both a financial materiality and impact materiality perspective. The materiality assessment process must also be reported upon.

Taxonomy Regulation

Companies within scope of the CSRD will also be subject to disclosure obligations under Article 8 of the EU Taxonomy Regulation, regarding the extent to which their activities are associated with economic activities which are ‘environmentally sustainable’.

Assurance

Sustainability reporting is subject to mandatory assurance, initially, on a limited assurance basis. The statutory auditor appointed to carry out assurance of sustainability reporting may be different from the statutory auditor appointed to carry out the financial audit. Irish law does not currently permit an independent assurance services provider other than a statutory auditor to provide the assurance report.

Value Chain

The CSRD requires an increased focus on the company’s upstream and downstream value chain. Companies which are not directly in-scope of the CSRD may be requested to provide sustainability information to in-scope entities within their value chain.

Key Intangible Resources

The directors’ report must also include information on ‘key intangible resources’ in relation to the company, an explanation of how the business model fundamentally depends on such resources and how such resources are a source of value creation for the company.

Group Companies

Exemptions are available, subject to certain conditions, for in-scope subsidiaries where that company and its subsidiaries (if any) are included in the group directors’ report of an EU parent company drawn up in accordance with the CSRD or in the consolidated report of a nonEU parent undertaking drawn up in accordance with the ESRS or with reporting standards deemed equivalent to the ESRS. To date, no sustainability reporting standards have been determined as equivalent to the ESRS.

Under a transitional measure available until January 2030, an in-scope EU subsidiary may prepare a ‘consolidated sustainability report’ including all in-scope EU subsidiaries which share a common non-EU parent.

Non-EU Companies

For financial years commencing from 1 January 2028, in-scope subsidiaries or Irish branches of non-EU companies, which generate significant turnover within the EU, will be required to publish a sustainability report on a consolidated basis for the group (or, if not applicable in the case of a branch, for the non-EU company).

Non-Compliance

For Irish in-scope companies, sustainability reporting will form part of their annual directors’ report and they are therefore subject to the existing obligations regarding the preparation of a directors’ report under the Companies Act 2014.

Global Sustainability Reporting Landscape

The CSRD exists alongside other sustainability reporting frameworks, including the ISSB sustainability disclosure standards. The European Commission and its technical advisor EFRAG have indicated that they have worked to ensure a high level of alignment between the ESRS and the ISSB standards and those of the Global Reporting Initiative.

Further Clarity Needed

Some anomalies have been identified in the Irish regulations transposing CSRD, two of which were recently addressed in amending regulations. Outstanding issues include: the definition of ‘applicable company’ (which may inadvertently bring certain companies, including certain listed SMEs, micro-entities and financial services companies within scope of the CSRD or within scope earlier than provided under the CSRD) and the ability of Irish subsidiaries to avail of the exemption when included in the consolidated reporting for a non-Irish EU parent. Arthur Cox LLP continues to engage with the Department of Enterprise, Trade and Employment in order to secure further clarity on these matters.

The CSRD represents a critical shift in sustainability reporting for businesses across the EU and beyond. Preparing now requires understanding the legal framework and practical steps for compliance.

This article was originally published in Legal Business.