The Corporate Sustainability Reporting Directive (CSRD) came into force across Europe in January 2023. Globally, countries are introducing their own frameworks, with momentum building toward greater alignment across sectors, markets, and reporting standards. But it’s 2025 when the real pressure begins.

This is the first year that thousands of large companies across the EU are expected to report under the new framework, using data from 2024. For sustainability leaders, that shifts the conversation from planning to proof. It’s no longer about whether your organisation is preparing. It’s whether your portfolio is ready.

CSRD demands more than ambition. It requires clarity, structure, and verifiable insight into how your assets actually perform. And that means energy efficiency, emissions, and operational transparency are now headline issues—not backend metrics.

What UK companies need to know

Even though the UK is no longer part of the EU, the CSRD could still apply. If your company has securities listed on an EU-regulated market, or if it generates more than €150 million in EU turnover, you may fall within scope. This includes UK firms with large EU subsidiaries or branches that generate significant revenue. It’s critical to review your structure now. Reporting obligations will expand, and compliance won’t just mean better paperwork—it means disclosing meaningful, auditable sustainability data across your operations.

Early CSRD reporters are flagging around 24 material topics and 40 key impacts, risks and opportunities on average—but there’s no consistent way they’re doing it. The takeaway? If your team isn’t aligned on how to approach double materiality, you’re going to struggle to report clearly or credibly.

Not just data—disclosure with direction

CSRD doesn’t just ask for more data. It requires meaningful and auditable reporting on how your operations align with environmental, social, and governance (ESG) expectations. This includes specific disclosures on energy use, carbon emissions, climate risk, and the resilience of assets across your portfolio.

This level of transparency means moving beyond estimates and modelled projections, toward real-world performance indicators that stand up to external scrutiny. Friends of EFRAG notes that while Scope 1 and 2 emissions are widely reported with clear targets, Scope 3 remains a significant challenge, especially across supply chains. Many companies set net-zero targets without clear pathways to reach them, making performance tracking and transparency non-negotiable.

The organisations that will thrive under this directive are those who already know how their buildings perform—and who can clearly show what’s improving, what’s not, and what comes next.

The role of building performance in CSRD

Buildings are one of the biggest contributors to operational emissions. That makes them a focal point in CSRD reporting, whether you manage a portfolio of offices, retail, logistics, or mixed-use assets.

But the real challenge isn’t the emissions themselves. It’s knowing where they come from, what’s driving them, and how to bring them down—credibly, not theoretically.

That’s where operational insight becomes essential. You don’t need hundreds of sensors or new systems to get started. Often, the first indicators are already available. What’s missing is a clear line of sight between performance, targets, and action. 

Don’t wait for compliance to catch you

CSRD is being phased in, but the reputational pressure is already here. Investors, regulators, and occupiers are all looking for clear evidence of environmental performance. And with carbon reporting under greater scrutiny, gaps in visibility won’t just delay compliance—they’ll erode confidence.

It’s not about racing to comply. It’s about using CSRD as a structure to validate what you already know: where performance is strong, where the friction points are, and how to prioritise action that actually delivers impact. Readiness isn’t about ticking boxes. It’s about knowing where you stand.

You don’t need to have all the answers. But you do need to be clear on how your portfolio performs today, and what needs to happen next.

In May 2025, the European Commission delivered a stark assessment of Ireland’s National Energy and Climate Plan (NECP), highlighting a significant shortfall in the country's projected emissions reductions. The NECP anticipates a 25.4% reduction by 2030, falling well below the legally binding target of 42% under the EU's effort-sharing regulation.

The Commission's critique extends beyond the emissions gap, pointing to a lack of clarity on funding mechanisms for the necessary €119–€125 billion investment outlined in the plan. This absence of a detailed financing strategy raises concerns about the feasibility of achieving the proposed climate objectives.

This evaluation signals potential regulatory tightening and increased scrutiny. Properties with poor energy performance may face increased pressure to undergo efficiency upgrades, which can impact asset valuations and investment decisions.

Implications for commercial real estate

The European Commission’s latest assessment is a reminder of how quickly expectations are shifting. Climate strategies that once felt ambitious are now considered baseline. And across commercial real estate, there’s growing pressure—not just to set goals, but to show progress.

In this environment, understanding how assets perform becomes more than a reporting exercise. It’s the foundation for resilience, credibility, and future value. Aligning with regulatory targets is part of the picture. But increasingly, it's the ability to demonstrate efficiency and impact that sets portfolios apart.

That starts with visibility. The clearer you are on how your portfolio operates today, the more confidently you can navigate what’s next.

The 17th Annual Global CSR & ESG Summit 2025 in Hong Kong brought together industry leaders to discuss the evolving role of sustainability in business. With a focus on climate action, transition finance, carbon emissions, and diversity, the event highlighted how companies can integrate ESG principles into long-term strategy and decision-making.

A key theme was the growing pressure on businesses to move beyond compliance and demonstrate measurable impact. Speakers emphasised the need for transparent reporting, scalable green finance solutions, and innovative approaches to reducing emissions. As regulations tighten and investor expectations rise, the summit reinforced the message that ESG is no longer optional—it’s a critical factor in building resilient, future-ready businesses.