Fraunhofer Institute for Material Flow and Logistics IMLThe concept of sustainability has been shaping everyday life in our society for some time now: Where does my electricity come from? Combustion engine or electric car? Are my vegetables locally grown? What are often just considerations in everyday life are much more complex on an industrial level. It is not enough to produce meaningful sustainability reports; their effectiveness must also be verifiable. This is where the AI tool ”Sustainalyze” from Fraunhofer IML comes into play. This tool is designed to standardize and analyze key figures and data and prevent the concealment of facts.
In Germany, the current legal basis for sustainability reporting is the Corporate Sustainability Reporting Directive Implementation Act (CSR-RUG), which has been in force since 2017. It requires large, capital market-oriented companies with more than 500 employees to disclose information on environmental, social and governance (ESG) topics. This is done using key figures such as greenhouse gas emissions, anti-corruption measures, and working conditions. On the EU level, the CSR Directive (CSRD) came into force in January 2023. It significantly expands the scope and depth of reporting requirements, introducing mandatory EU-wide reporting standards (ESRS), external assurance and the principle of double materiality. The CSRD must be transposed into national law by July 2024 and will gradually apply to more companies – including listed SMEs starting in 2026. CSR-RUG and CSRD are two separate regulatory frameworks with different scopes and requirements. While CSRRUG remains applicable for now, CSRD paves the way for a broader and more harmonized approach to sustainability reporting across the EU.
One of the biggest challenges is the oftenincomplete database, which increases the risk of greenwashing. This means that companies sometimes “paint themselves green” by appearing more environmentally friendly than they actually are – with the aim of improving their image and winning customers through misleading statements.
