Simplifying CSRD and CSDDD compliance with automated LCA

The Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD) are transforming the regulatory landscape for companies in the EU. These regulations require extensive sustainability reporting and due diligence in supply chains, pushing businesses to address their environmental and social impacts.

In this blog, discover why these regulations matter and how Root’s automated Life Cycle Assessment (LCA) platform can ensure compliance with these regulations. 

PUBLISHED: 13 June 2024

WRITTEN BY: Charlie Walter

Table of contents

What are the CSRD and CSDDD regulations and why are they so important?

The CSRD governs sustainability reporting in the EU, aligning it with the rigour of financial reporting. Companies affected by this regulation must create detailed reports on their environmental, social and governance impacts. The CSRD has led to the creation of the European Sustainability Reporting Standards (ESRS) which outline the required content for these reports. Large EU companies will need to begin reporting in 2025, with reporting obligations expanding to medium and small-sized companies in 2027 and full implementation is expected by 2029 for companies that meet the minimum requirements. Meanwhile, the CSDDD requires companies to conduct due diligence on their supply chains for human rights and environmental issues and take action to address any identified problems. Together, these regulations aim to increase corporate accountability and sustainability.

How do these regulations impact companies?

The CSRD and CSDDD significantly impact companies by requiring them to:

  • Collect and Report Extensive Sustainability Data: Disclose detailed information on environmental impacts including water usage, waste management, greenhouse gas emissions, pollution and biodiversity. 
  • Complete a Double Materiality Assessment: Conduct a double materiality assessment to evaluate both the impacts caused by the organisation and the risks and opportunities affecting the company.
  • Manage Supply Chains More Rigorously: Conduct thorough due diligence on supply chains, investigating environmental impacts on key stages of a product’s lifecycle including raw material extraction, parts products, logistics and waste streams. 
  • Integrate Sustainability into Core Business Strategies: Incorporate sustainability practices into operations and governance structures.
  • Undergo Mandatory Assurance and Audits: Provide verified and assured reports on due diligence performance.

Non-compliance can lead to fines, potential prison time, damage to brand reputation and loss of stakeholder trust.

The power of automated LCA

Traditional LCA methods are impractical for complying with CSRD and CSDDD regulations. They are complex, time-consuming, costly and typically focus on one product at a time. This makes it difficult for businesses to provide the necessary environmental data on all products needed for comprehensive CSRD reporting and effective CSDDD due diligence.

This is where Root steps in. Root’s automated LCA SaaS platform simplifies compliance by managing thousands of product footprints simultaneously. It creates robust and comprehensive data for CSRD reporting and effective due diligence needed for CSDDD compliance. By automating the LCA process, Root speeds up data collection and analysis, enhancing the reliability of environmental reporting and supporting companies in their due diligence efforts.

How can Root help with compliance?

Root ensures compliance with CSRD and CSDDD regulations through:

  • Data for CSRD Reporting: Root collects and centralises detailed environmental data for every product’s supply chain, which can be used for CSRD reporting. This includes the key environmental metrics mandated by the European Sustainability Reporting Standards (ESRS). Root’s platform improves accuracy, saves time, and enhances the credibility of CSRD reports.
  • Insights for Double Materiality Assessments: Root supplies essential data on environmental impacts and risks of products, providing valuable insights when conducting the double materiality assessment.
  • Supply Chain Mapping: Root provides data on each product’s unique supply chain, helping companies map and manage their supply chains effectively. This facilitates robust due diligence and ensures compliance with CSDDD.
  • Data-driven Due Diligence Processes: Root’s lifecycle environmental data helps develop data-driven, focused due diligence policies and procedures. This aids companies in identifying and addressing environmental impacts and facilitating compliance with CSDDD.
  • Due Diligence Monitoring: Root enables companies to track progress on due diligence processes, ensuring ongoing compliance with CSDDD.

We can help

Root’s vision is to redefine the norm by making product footprints universal. Our platform conducts LCA for all products, helping businesses report effectively on regulations, avoid greenwashing, become industry leaders and grow.

Root partners with companies to ensure compliance with CSRD and CSDDD. Our automated LCA platform provides detailed environmental data for reporting, provides insights for double materiality assessments, maps supply chains and aids in developing and monitoring due diligence processes.

Interested to learn more? Get in touch with our team to discover how Root can help you achieve compliance and drive sustainable growth.