Having a sustainability report today is no longer optional, it’s a real obligation for many companies.
With the introduction of the CSRD (Corporate Sustainability Reporting Directive), generic statements or one-off initiatives are no longer enough. A clear, complete report aligned with European standards is now required.
In this guide, we’ll walk you through how to build a sustainability report in line with the CSRD, step by step. We’ll cover what to include, where to start, which data to collect, who to involve within your company, and which tools can truly simplify the process.
A practical guide designed for SMEs, sustainability managers, consultants, and anyone preparing for this major change.
What is a Sustainability Report and Why Has It Become Mandatory?
A sustainability report is a document that clearly and systematically explains how a company manages its environmental, social, and governance responsibilities.
Until a few years ago, this was reserved for large corporations. But today, with the entry into force of the CSRD (Corporate Sustainability Reporting Directive), it has become mandatory for an increasing number of companies, including SMEs that meet certain criteria.
Through this directive, the European Commission aims to bring transparency to corporate sustainability, going beyond financial reporting. In practice, alongside the financial statement, companies must now also report their environmental and social impacts with the same level of rigor.
What the New European Directive Requires
The CSRD replaces the old NFRD – Non-Financial Reporting Directive, introducing much more detailed requirements. Companies must report not only what they are doing, but also how, with what objectives, and what results they are achieving in all areas of sustainability.
The main obligations include:
- Applying the principle of double materiality, evaluating both the impact of the business on the environment and society, and the risks and opportunities for its own financial performance
- Communicating ESG policies
- Collecting structured and verifiable data
- Publishing the report in a readable digital format
All of this must follow the European Sustainability Reporting Standards (ESRS).
Reporting on 2024 data begins already for reports published in 2025, but the timeline for application varies depending on size, sector, number of employees, and revenue.
Where to Start? First Steps in Building the Report
The first concrete step is to define which ESG topics are truly relevant for your company. This is where double materiality analysis comes in, helping you identify the key ESG topics to report on, those that reflect both your impact on the environment and society, and the risks and opportunities for your financial performance.
To do this, you need to:
- Set up an internal team (even if it’s small) to coordinate the process
- Define a list of ESG topics to analyze for relevance (starting from the ESRS, the list may include topics such as: climate change, pollution, water and marine resources, biodiversity, resource use and circular economy, workforce, value chain, affected communities, consumers and end-users, corporate conduct)
- Map internal and external stakeholders to involve (employees, suppliers, customers, etc.) through surveys, workshops, or other appropriate engagement methods to gather feedback on the company's ESG impacts, risks, and opportunities
- Build a materiality matrix, crossing internal (for the company) and external (for stakeholders) relevance of each ESG topic based on the engagement results
Once the relevant ESG topics are identified:
- Create a simple yet realistic roadmap to organize data collection and reporting in phases
What a CSRD-Compliant Sustainability Report Must Contain
The report must include the material topics identified (both from the inside-out and outside-in perspectives), strategic sustainability objectives, and related KPIs.
It must also contain policies, risks, results achieved, the methodology used for the materiality analysis, and planned improvement actions. Finally, include information on involved stakeholders and initiatives implemented.
This is not just a list of data, but a structured corporate narrative, aligned with European standards.
How to Collect the Right Data
Start by leveraging the data you already have, it makes everything more manageable.
Here’s where to begin:
- Involve departments that already hold useful data (HR, quality, safety, finance)
- Prioritize comparable and repeatable data over time: training hours, energy consumption, % of women in leadership roles, etc.
Tip: Don’t wait until the last month of the year, instead set up continuous data collection.
What is the European Sustainability Reporting Standard and How to Use It Without Overcomplicating
The ESRS are the standards all companies must follow to comply with the CSRD. They are detailed and can seem overwhelming, but not all apply to you and you can focus only on those material to your sector.
Our suggestion is to start with the general standards (ESRS 1 and 2), then choose specific ones only if relevant, such as ESRS E1 for climate or S1 for workforce. No need for an encyclopedic approach: better to provide a few well-explained data points than a long, vague report!
Who to Involve in the Company to Draft the Sustainability Report
It takes a collective effort, even in SMEs. Engage early with those who have a strategic vision (e.g., CEO or general management), data managers (quality, accounting, HR), and communications team (because the report is also an external message).
Engaging multiple perspectives helps avoid errors, optimize resources, and give real meaning to the report.
How to Keep the Report Updated and Make Reporting Sustainable
This shouldn’t be a year-end scramble. The sustainability report works best when integrated into management routines.
For this, we recommend:
- Monthly data collection, even with simple tools
- Planning quarterly reviews
- Using tools to automate certain metrics (e.g., consumption, attendance)
This way, you’ll be fully prepared to build your report by year-end.
Practical Example: How a Sustainability Report is Structured
Here’s a concrete possible structure:
- Executive summary with key results
- Introduction with company identity, context, goals
- Methodology including double materiality analysis and stakeholder engagement
- Material topics covering risks, opportunities, strategies
- ESG data with key indicators and comments
- Conclusions: future improvements, commitments, governance
You can enrich the report with infographics, factsheets, and in-depth notes to make it more readable and useful externally.
Useful Tools for SMEs: How to Simplify the Entire Process with Uyolo
Drafting a CSRD-compliant sustainability report is a challenge, but you’re not alone. With Uyolo, you can manage everything in one platform, designed specifically for SMEs.
With Uyolo you can:
- Conduct a double materiality analysis using ready-made templates
- Collect monthly data with intuitive forms
- Involve teams and stakeholders with digital surveys
- Build your report with a guided structure, already aligned to ESRS
- Generate compliant reports, ready for publication and review
Conclusion: Why Sustainability Reporting is an Opportunity Even for SMEs
Drafting a sustainability report today is much more than a mere regulatory requirement: it is a true operational guide for organizations that wish to approach their sustainability journey with seriousness and commitment. Whether you’re a large enterprise or a small business, the report, also known as a social report, is a strategic tool to improve performance, transparency, investor relations, and reputation across the value chain.
By following regulatory guidelines and sustainability reporting criteria, companies can document their environmental, social, and governance aspects, showcasing their commitment and impact.
Every section contributes to a detailed review of activities, management practices, and adopted policies, offering a concrete and credible overview. This is not just about meeting EU Parliament and Commission expectations, it’s about leveraging the report as a driver of evolution for society as a whole.
Regular reporting helps consolidate a stronger management system aligned with measurable environmental and social criteria and evolving expectations around responsibility. Most importantly, it provides a clear roadmap for continuous improvement, year after year.
In summary, the sustainability report is not just a document: it is a tangible expression of a company’s cultural shift towards a future built with awareness, methodology, and shared values.
Ready to Start? Book a Free Demo with Uyolo
Do you need a simple tool to tackle sustainability reporting, manage risks, meet new European regulations, and turn it all into a value-creation lever for your business?
Book a free demo and discover how Uyolo can help you build a complete, clear, and CSRD-compliant sustainability report. A concrete solution for companies that want to approach corporate sustainability with method, transparency, and the right tools.
It’s time to move from theory to practice, with flexibility, effectiveness, and a clear vision of your role in the new European non-financial reporting framework.
