ESG Talk 2

CSRD scope exemptions

Video
01 Dec 2023

In the previous ESG Talk, we used some examples to discuss the scope of the CSRD. What the examples showed is that making a correct CSRD scope assessment can be complicated. How does this work for group structures? Can they use any of the consolidation exemptions available for financial reporting?

01/12/23

ESG Talk 2 | CSRD scope exemptions

“Many companies will look for consolidation exemptions, but the CSRD does not offer a lot of options.”

Different exemption criteria for financial reporting and sustainability reporting

While article 408 of the Dutch Civil Code (DCC) and IFRS 10 offer consolidation exemptions for financial reporting, the CSRD takes a different path. The European Directive makes a distinction between consolidation within financial reporting and sustainability reporting. So in some situations, a subsidiary can use the financial reporting consolidation under article 408 DCC but will still have to prepare its own consolidated sustainability report. In this video we discuss a number of common group situations to explain this perhaps somewhat unexpected arrangement:

a group with an EU parent company (02:00)
a group with a non-EU parent company (03:20)
a group of sister companies which apply the artificial consolidation exemption (05:05).

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Hugo van den Ende

Senior Director, PwC Netherlands

Tel: +31 (0)65 364 51 09