SUMMARY SUSTAINABILITY REPORTING AND ASSURANCE
Course information:
6ECTS
Reading material list updated throughout the semester
Knowledge checks during HOC can be interesting for the exam
Written exam 75% & group assignment 25%
You don’t need to know the definition on slides by heart but you have to know the concepts and
you need to be able to give your own definition.
Course calendar:
HOC 1 (26/09): Introduction to sustainability, reporting standards, and regulatory framework
HOC 2 (03/10): Reporting examples & assignment introduction
HOC 3 (10/10): Introduction to CSRD & key concepts
HOC 4 (17/10): Reporting on environmental matters (incl. carbon footprint)
HOC 5 (24/10): Reporting on social & governance matters
HOC 6 (31/10): EU Taxonomy / SFDR
HOC 7 (07/11): Work & coaching session (mandatory)
HOC 8 (14/11): Sustainability reporting in practice
HOC 9 (21/11): Sustainability assurance
HOC 10 (28/11): Assignment presentations – Group 1
HOC 11 (05/12): Assignment presentations – Group 2
HOC 12 (19/12): What is next & recent updates (Omnibus & wrap-up)
Exam: Written, January 6th
Study overview:
HOC1 – p2
HOC2 – p22
HOC3 – p32
HOC4 – p60
HOC5 – p84
HOC6 – p104
HOC7 – p116
HOC8 – p117
HOC9 – p144
HOC10 – p157
1
, HOC 1: INTRODUCTION TO SUSTAINABILITY, REPORTING STANDARDS, AND REGULATORY FRAMEWORK
1. What is sustainability & ESG?
1.1 What is sustainability & ESG?
ESG versus sustainability
A set of environmental, social & governance issues that positively ESG focuses on
ESG measurable
or negatively affect financial performance.
factors, while
Operating in a way that meets today’s needs without sustainability
Sustainability compromising the ability of future generations to meet their own focuses on
needs, balancing economic, social & environmental goals. broader LT vision
The three pillars of sustainability (E,S,G)
1. Environmental: How organisations interact with climate and natural systems, creating both risks and
opportunities for their business.
2. Social: Focuses on equality, human rights, diversity, labour practices and consumer protection,
highlighting the need for strong stakeholder (=employees, suppliers, customers, communities)
relationships.
3. Governance: How organisations are led and controlled, covering leadership, pay, ownership,
competition, ethics, tax transparency and risk management to ensure accountability and integrity.
Why should businesses care about taking action?
ESG and business are closely linked. Businesses should care about ESG because it’s three biggest
stakeholders (= investors, consumers, employees ) are reshaping how they define value and making
decisions based on sustainability actions.
This has the potential to affect:
− The way companies do business
− Who they do business with
− How capital is allocated
Real-life examples:
− Investors: Expect sustainability risks, costs, and ESG strategy integration to be disclosed.
− Consumers: Demand active ESG leadership and are willing to pay more for sustainable products.
− Employees: Prefer working for companies aligned with their sustainability values.
1.2 Explore the environmental, social and governance issues
A window on the world
For every example we’ll see we’ll discuss what’s happening there, what’s the broader theme and how we
can measure it. We will look at real-life events of ESG issues to show:
→ What ESG issues look like in practice
→ The broader theme (environmental, social or governance) they illustrate
→ Indicators that could be used to measure their scale, impact, or status.
2
, Be aware: There is no exhaustive or fixed list of ESG issues; it is a dynamic concept that evolves with
time and emerging trends.
Pollution: In agriculture, pesticides used to protect crops often wash into rivers and
eventually the sea. This represents the environmental issue of pollution, which refers
E to harmful contaminants released into water, air, or soil. Pollution has direct health
consequences (e.g. respiratory illnesses). Companies can measure this issue, for
example, by analyzing water samples for toxicants like insecticides and herbicides.
Biodiversity and ecosystems: A fruit-growing company that uses pesticides may
unintentionally eliminate insect species, which in turn reduces the populations of
birds that feed on them. This illustrates the issue of biodiversity loss, where the
E variety of living organisms in an ecosystem is disrupted. Such imbalances can have
disastrous effects on the environment. The scale of biodiversity loss can be assessed
through indicators like changes in species numbers over time or the company’s
budget for pesticides.
.
Climate change: A confectionery factory emits CO2 by burning gas for heating. It also
contributes indirectly through the emissions of its electricity supplier and the trucks
distributing its products. This relates to climate change, driven mainly by greenhouse
E gases (GHGs). Businesses with high emissions face risks as economies move toward
low-carbon models. Emissions are measured in tonnes of CO₂ equivalent (tCO₂e) and
grouped into Scope 1 (direct emissions), Scope 2 (indirect from purchased energy),
and Scope 3 (indirect across the value chain).
Water and marine resources: A microchip manufacturer relies heavily on water in its
production process. Droughts limit supply, creating shortages while demand is high.
This highlights the issue of water and marine resource dependency. Most industries
E depend significantly on nature, and disruptions in water availability can impact entire
value chains. Companies need to manage how they both rely on and impact natural
resources. One way to measure this is by tracking volumes of water withdrawn, used,
discharged, and reused.
Resource use and circular economy: A footwear company generates 150 tons of
waste material from making trainers and sends it to landfill. This represents the issue
of resource use and waste management. Waste should not just be seen as a cost or
E a problem: it can also be an opportunity to reuse materials and move toward a
circular economy. Here, the company could recycle leftover materials to create new
products, cutting costs and reducing waste. The amount of waste can be measured
by weighing material sent to landfill and material that is recovered and reused.
Affected communities: A mining company provides jobs for local communities but
also generates heavy pollution. This case highlights the issue of community impacts,
where companies need to consider how their activities affect local populations.
S Responsible businesses go beyond harm reduction and actively invest in
communities, for example through education or clean water projects. Measuring this
can involve examining company policies for managing impacts, the existence of
engagement processes with communities, and stakeholder analysis for new projects.
3
, Consumers and end-users: A supermarket gathers customer data via loyalty cards and
sells it to third parties while also using it to train AI systems. This example raises the
S
issue of consumer rights and trust, particularly around data privacy. Beyond protecting
privacy, this issue also extends to product safety, accessibility, and inclusiveness.
Companies can demonstrate accountability by setting up consumer engagement
processes and clear channels for customers to raise concerns.
Workers in the Value Chain – Modern Slavery: At a public event, staff outsourced
from a third-party supplier face exploitative practices such as confiscation of passports
and forced living conditions. This is a hidden form of modern slavery and illustrates
S the broader responsibility companies have for workers not only within their own
operations but also across their supply chains. To address this, companies can track
the proportion of suppliers offering modern slavery training, publishing human rights
reports, or integrating sustainability criteria into their contracts.
.
Own Workforce – Diversity and Inclusion: An engineering company rewards male
employees more often with pay raises and bonuses, revealing discrimination in its
workforce management. This example highlights the importance of diversity and
inclusion within an organisation’s own workforce. A sustainable business ensures fair
S treatment and promotes equal participation across gender, ethnicity, disability, and
other characteristics. Companies can monitor this with metrics such as gender pay
gaps, turnover rates, adequate wage coverage, and representation of employees with
disabilities.
.
Political Lobbying: A healthcare company is well known for promoting health, but
behind the scenes it spends money lobbying politicians to relax rules so its medicines
are more easily sold. This raises the issue of political lobbying: when a company’s
G political actions conflict with its sustainability goals, it can lose trust from the public,
investors, and customers. To stay transparent, companies should disclose how much
money they spend on lobbying, which politicians or organisations they support, and
the topics they lobby for.
Corruption and Bribery: A construction company accepts bribes and kickbacks (secret
payments) in exchange for subcontracting contracts. This illustrates the governance
issue of corruption, which includes bribery, fraud, collusion, and other illegal or
G dishonest practices. Corruption not only breaks the law but also damages public and
employee trust in the company. Organisations can measure their exposure by
reporting the number and types of corruption cases and ensuring that employees
receive training in anti-corruption and integrity practices.
Environmental issues include pollution, biodiversity loss, climate change, water scarcity, and waste.
Social issues cover community impacts, consumer rights, labour practices, and diversity.
Governance issues highlight the risks of lobbying and corruption.
A broader view of E, S and G topics
One way of naming and grouping a range of ESG topics, which drive some of the most influential
legislation appearing.
4
Course information:
6ECTS
Reading material list updated throughout the semester
Knowledge checks during HOC can be interesting for the exam
Written exam 75% & group assignment 25%
You don’t need to know the definition on slides by heart but you have to know the concepts and
you need to be able to give your own definition.
Course calendar:
HOC 1 (26/09): Introduction to sustainability, reporting standards, and regulatory framework
HOC 2 (03/10): Reporting examples & assignment introduction
HOC 3 (10/10): Introduction to CSRD & key concepts
HOC 4 (17/10): Reporting on environmental matters (incl. carbon footprint)
HOC 5 (24/10): Reporting on social & governance matters
HOC 6 (31/10): EU Taxonomy / SFDR
HOC 7 (07/11): Work & coaching session (mandatory)
HOC 8 (14/11): Sustainability reporting in practice
HOC 9 (21/11): Sustainability assurance
HOC 10 (28/11): Assignment presentations – Group 1
HOC 11 (05/12): Assignment presentations – Group 2
HOC 12 (19/12): What is next & recent updates (Omnibus & wrap-up)
Exam: Written, January 6th
Study overview:
HOC1 – p2
HOC2 – p22
HOC3 – p32
HOC4 – p60
HOC5 – p84
HOC6 – p104
HOC7 – p116
HOC8 – p117
HOC9 – p144
HOC10 – p157
1
, HOC 1: INTRODUCTION TO SUSTAINABILITY, REPORTING STANDARDS, AND REGULATORY FRAMEWORK
1. What is sustainability & ESG?
1.1 What is sustainability & ESG?
ESG versus sustainability
A set of environmental, social & governance issues that positively ESG focuses on
ESG measurable
or negatively affect financial performance.
factors, while
Operating in a way that meets today’s needs without sustainability
Sustainability compromising the ability of future generations to meet their own focuses on
needs, balancing economic, social & environmental goals. broader LT vision
The three pillars of sustainability (E,S,G)
1. Environmental: How organisations interact with climate and natural systems, creating both risks and
opportunities for their business.
2. Social: Focuses on equality, human rights, diversity, labour practices and consumer protection,
highlighting the need for strong stakeholder (=employees, suppliers, customers, communities)
relationships.
3. Governance: How organisations are led and controlled, covering leadership, pay, ownership,
competition, ethics, tax transparency and risk management to ensure accountability and integrity.
Why should businesses care about taking action?
ESG and business are closely linked. Businesses should care about ESG because it’s three biggest
stakeholders (= investors, consumers, employees ) are reshaping how they define value and making
decisions based on sustainability actions.
This has the potential to affect:
− The way companies do business
− Who they do business with
− How capital is allocated
Real-life examples:
− Investors: Expect sustainability risks, costs, and ESG strategy integration to be disclosed.
− Consumers: Demand active ESG leadership and are willing to pay more for sustainable products.
− Employees: Prefer working for companies aligned with their sustainability values.
1.2 Explore the environmental, social and governance issues
A window on the world
For every example we’ll see we’ll discuss what’s happening there, what’s the broader theme and how we
can measure it. We will look at real-life events of ESG issues to show:
→ What ESG issues look like in practice
→ The broader theme (environmental, social or governance) they illustrate
→ Indicators that could be used to measure their scale, impact, or status.
2
, Be aware: There is no exhaustive or fixed list of ESG issues; it is a dynamic concept that evolves with
time and emerging trends.
Pollution: In agriculture, pesticides used to protect crops often wash into rivers and
eventually the sea. This represents the environmental issue of pollution, which refers
E to harmful contaminants released into water, air, or soil. Pollution has direct health
consequences (e.g. respiratory illnesses). Companies can measure this issue, for
example, by analyzing water samples for toxicants like insecticides and herbicides.
Biodiversity and ecosystems: A fruit-growing company that uses pesticides may
unintentionally eliminate insect species, which in turn reduces the populations of
birds that feed on them. This illustrates the issue of biodiversity loss, where the
E variety of living organisms in an ecosystem is disrupted. Such imbalances can have
disastrous effects on the environment. The scale of biodiversity loss can be assessed
through indicators like changes in species numbers over time or the company’s
budget for pesticides.
.
Climate change: A confectionery factory emits CO2 by burning gas for heating. It also
contributes indirectly through the emissions of its electricity supplier and the trucks
distributing its products. This relates to climate change, driven mainly by greenhouse
E gases (GHGs). Businesses with high emissions face risks as economies move toward
low-carbon models. Emissions are measured in tonnes of CO₂ equivalent (tCO₂e) and
grouped into Scope 1 (direct emissions), Scope 2 (indirect from purchased energy),
and Scope 3 (indirect across the value chain).
Water and marine resources: A microchip manufacturer relies heavily on water in its
production process. Droughts limit supply, creating shortages while demand is high.
This highlights the issue of water and marine resource dependency. Most industries
E depend significantly on nature, and disruptions in water availability can impact entire
value chains. Companies need to manage how they both rely on and impact natural
resources. One way to measure this is by tracking volumes of water withdrawn, used,
discharged, and reused.
Resource use and circular economy: A footwear company generates 150 tons of
waste material from making trainers and sends it to landfill. This represents the issue
of resource use and waste management. Waste should not just be seen as a cost or
E a problem: it can also be an opportunity to reuse materials and move toward a
circular economy. Here, the company could recycle leftover materials to create new
products, cutting costs and reducing waste. The amount of waste can be measured
by weighing material sent to landfill and material that is recovered and reused.
Affected communities: A mining company provides jobs for local communities but
also generates heavy pollution. This case highlights the issue of community impacts,
where companies need to consider how their activities affect local populations.
S Responsible businesses go beyond harm reduction and actively invest in
communities, for example through education or clean water projects. Measuring this
can involve examining company policies for managing impacts, the existence of
engagement processes with communities, and stakeholder analysis for new projects.
3
, Consumers and end-users: A supermarket gathers customer data via loyalty cards and
sells it to third parties while also using it to train AI systems. This example raises the
S
issue of consumer rights and trust, particularly around data privacy. Beyond protecting
privacy, this issue also extends to product safety, accessibility, and inclusiveness.
Companies can demonstrate accountability by setting up consumer engagement
processes and clear channels for customers to raise concerns.
Workers in the Value Chain – Modern Slavery: At a public event, staff outsourced
from a third-party supplier face exploitative practices such as confiscation of passports
and forced living conditions. This is a hidden form of modern slavery and illustrates
S the broader responsibility companies have for workers not only within their own
operations but also across their supply chains. To address this, companies can track
the proportion of suppliers offering modern slavery training, publishing human rights
reports, or integrating sustainability criteria into their contracts.
.
Own Workforce – Diversity and Inclusion: An engineering company rewards male
employees more often with pay raises and bonuses, revealing discrimination in its
workforce management. This example highlights the importance of diversity and
inclusion within an organisation’s own workforce. A sustainable business ensures fair
S treatment and promotes equal participation across gender, ethnicity, disability, and
other characteristics. Companies can monitor this with metrics such as gender pay
gaps, turnover rates, adequate wage coverage, and representation of employees with
disabilities.
.
Political Lobbying: A healthcare company is well known for promoting health, but
behind the scenes it spends money lobbying politicians to relax rules so its medicines
are more easily sold. This raises the issue of political lobbying: when a company’s
G political actions conflict with its sustainability goals, it can lose trust from the public,
investors, and customers. To stay transparent, companies should disclose how much
money they spend on lobbying, which politicians or organisations they support, and
the topics they lobby for.
Corruption and Bribery: A construction company accepts bribes and kickbacks (secret
payments) in exchange for subcontracting contracts. This illustrates the governance
issue of corruption, which includes bribery, fraud, collusion, and other illegal or
G dishonest practices. Corruption not only breaks the law but also damages public and
employee trust in the company. Organisations can measure their exposure by
reporting the number and types of corruption cases and ensuring that employees
receive training in anti-corruption and integrity practices.
Environmental issues include pollution, biodiversity loss, climate change, water scarcity, and waste.
Social issues cover community impacts, consumer rights, labour practices, and diversity.
Governance issues highlight the risks of lobbying and corruption.
A broader view of E, S and G topics
One way of naming and grouping a range of ESG topics, which drive some of the most influential
legislation appearing.
4
