How to Create a Comprehensive Sustainability Report: Key Steps and Standards

A sustainability report is not just a legal obligation for companies—it’s also a tool to create transparency and strengthen market position. Here you’ll find the key steps and requirements:

• Why a sustainability report?
  It documents ESG performance (Environmental, Social, Governance), fulfills legal requirements (e.g., CSRD), builds stakeholder trust, and enhances your sustainability strategy. According to PwC, companies that proactively report on ESG factors are better equipped to identify risks and opportunities, which can lead to improved financial performance and reputation (source).
• Essential components of a report:
  • Company overview: Goals, strategy, and contribution to the UN Sustainable Development Goals.
  • Topic analysis: Materiality analysis with stakeholder engagement.
  • Key figures: CO₂ emissions, energy and water consumption, employee turnover.
• Legal requirements:
  Companies with >1,000 employees or >€50 million in revenue must report according to CSRD and ESRS. The European Commission’s CSRD directive aims to standardize sustainability disclosures, making them more comparable and reliable (source).
• Tools and standards:
  Choose suitable standards like GRI, ESRS, or DNK. Tools such as VERSO or Envoria make data collection and reporting easier.
• How to get started:
  Plan your report, gather accurate data, create a clear structure, and have the report externally audited.

A sustainability report is more than just a requirement—it’s an opportunity to showcase progress and secure long-term competitive advantages. In fact, research from the Institute of Sustainability Studies highlights that companies with robust sustainability initiatives often experience increased stakeholder loyalty and improved access to capital (source).

Main Components of a Sustainability Report

A sustainability report consists of three main areas that clearly and transparently present a company’s ESG performance (Environmental, Social, Governance). This transparency is increasingly demanded by investors and consumers alike, who are seeking evidence of genuine progress rather than greenwashing.

"With a sustainability report, you inform about all of your company’s sustainability achievements." – SAIM

Company Overview and Goals

Once company goals are defined, the next step is selecting and prioritizing relevant sustainability topics. Aligning with the UN SDGs not only demonstrates global responsibility but also connects company actions to internationally recognized priorities, which can enhance credibility and stakeholder engagement.

Topic Selection and Prioritization

This process involves four steps:

• Context analysis: Examine the environment and framework conditions.
• Identification of material impacts: Analyze internal and external influences.
• Stakeholder engagement: Engage with stakeholders through surveys or workshops.
• Materiality analysis: Assess and prioritize topics in a materiality matrix (source).

Based on this, measurable outcomes and key figures are defined. According to Sustain.Life, companies that conduct thorough materiality analyses are better able to focus their resources on the most impactful sustainability issues, resulting in more meaningful reporting (source).

Results and Key Figures

The report focuses on concrete KPIs (Key Performance Indicators) and their development. These should be quantifiable, comparable, and in line with ESRS standards (European Sustainability Reporting Standards). For example, tracking year-over-year reductions in CO₂ emissions or improvements in employee retention rates provides tangible evidence of progress.

"Reporting documents the sustainable development of the company. This helps improve its sustainability performance." – SAIM

Key figures include:

• CO₂ emissions (t)
• Energy consumption (kWh)
• Water consumption (m³)
• Waste generated (t)
• Employee turnover (%)

The data should be machine-readable and externally audited to meet CSRD (Corporate Sustainability Reporting Directive) requirements. Presenting key figures over several years makes it easier to assess progress and identify trends, which is essential for continuous improvement.

How to Create a Sustainability Report

An effective sustainability report requires careful planning and structured implementation. Here are the key steps to create a clear and informative report.

Planning the Report

Solid planning is the first step. Assemble a team from various departments familiar with your company’s sustainability strategy. This team selects the appropriate reporting standards and sets the strategic direction. Involving cross-functional teams ensures that all relevant data points are captured and that the report reflects the organization’s full range of sustainability activities.

With a clear plan, you can focus on data collection and analysis.

Data Collection and Analysis

The foundation of a good report is precise and reliable data. Collect relevant key figures systematically and document the methods to ensure transparency. Standardized data collection processes, such as those recommended by GRI, help ensure consistency and comparability across reporting periods (source).

Key steps in data collection:

• Identify data sources: Find reliable internal and external sources.
• Apply standardized methods: Establish clear procedures for consistent data collection.
• Ensure quality: Control mechanisms ensure data is accurate and verifiable.

Creation and Review

After collecting data, it’s time to actually create the report. Make sure the report meets CSRD requirements.

Key points when writing:

• Structure: Divide the report into clearly organized sections.
• Visualization: Use charts and graphics to make complex data easy to understand.
• Review: Have the report reviewed internally and externally. An external audit is required under CSRD and ensures the data is reliable and the KPIs are relevant.

"Reporting documents the sustainable development of the company. This helps improve its sustainability performance." – SAIM

sbb-itb-7d4371c

Reporting Standards and Guidelines

After data collection and planning, it’s important to choose the right reporting standard to present information clearly and comparably. Companies must consider different frameworks, each with specific requirements. Here’s a summary of the three most important standards—GRI, ESRS, and DNK.

Overview of the Global Reporting Initiative (GRI) standards

The Global Reporting Initiative (GRI) standards are widely used worldwide and serve as a basis for sustainability reporting. They cover economic, environmental, and social aspects and provide a clear structure for reporting. According to GRI, over 10,000 organizations in more than 100 countries use these standards, making them the most widely adopted framework globally (source).

ESRS Requirements

The ESRS were developed specifically for the EU and are mandatory for large companies under the CSRD. This standard emphasizes precise and quantifiable reporting.

• Machine readability: Reports must be available in a digital format.
• Double materiality: Considers both financial risks and impacts on the environment and society.
• Focus on numbers: Requires concrete data instead of general descriptions.

DNK Guidelines

The German Sustainability Code (DNK) is a national standard tailored to the needs of German companies. It combines strategic analysis with systematic process management to effectively capture sustainability goals.

Key elements of DNK:

• Environmental indicators: Clear metrics on resource use and climate protection.
• Social indicators: Focus on employee rights and social engagement.

Choosing the right reporting standard is crucial to ensure transparent and comprehensible sustainability reporting.

Tools and Methods for Better Reports

The right combination of software and methodological approaches can significantly improve a sustainability report. With modern tools, companies can efficiently collect, analyze, and visually present their results. According to EcoVadis, digital reporting platforms can reduce reporting time by up to 40% and improve data accuracy (source).

Software and Data Tools

Selecting suitable software not only makes data collection easier but also analysis and presentation. Here are some tools particularly well-suited for this purpose:

"We chose Envoria as our ESG software solution because it supports us in implementing our CSRD, EU taxonomy, and CO₂ reporting. It was especially important to us that the solution could be tailored to our company’s specific needs. The expertise of the consultants is also noteworthy."

In addition to pure data collection, the visual and comprehensible presentation of results also plays a major role.

Tips for an Appealing Report Layout

A well-structured layout makes reports not only more readable but also more persuasive. Key elements include:

• Graphics and charts: Help make complex data easy to understand.
• Digital readability: Reports should be easily readable on various devices.
• Clearly structured outline: Logical chapter sequence and clear hierarchies improve navigation.

One example is Simply V, which successfully visualized its resource consumption and waste reduction measures in March 2023 using impactful graphics and stakeholder testimonials. Such approaches can increase engagement and make sustainability achievements more tangible for readers.

Building Trust Through External Audit

External validation ensures greater credibility and strengthens trust in the report. According to PwC, an external audit can help companies identify gaps in their reporting processes and enhance the reliability of disclosed information (source).

Key verification measures include:

• Engaging external auditors to review KPIs
• Transparent disclosure of methods and data sources used
• Regular updates and reviews of report content

With a combination of powerful tools, a clear layout, and independent validation, a sustainability report becomes not only informative but also compelling.

Conclusion: Next Steps

Regular Updates and Adjustments

A sustainability report must be continuously updated. Pay particular attention to the following points:

• Legal requirements: Observe regulations such as CSRD, ESRS, and the Green Claims Directive.
• Stakeholder feedback: Use feedback to improve the materiality analysis and meet information needs.
• Data basis: Clearly and transparently document KPIs, methods, and data sources.

A report that discloses current key figures and their foundations provides a solid basis for sustainable business growth. Regular updates ensure that the report remains relevant and continues to meet evolving stakeholder expectations and regulatory requirements.

Growth Through Targeted Reporting

A well-structured sustainability report can be an effective tool for business growth. Three key points are crucial:

1. Engage stakeholders
   Actively involve internal and external stakeholders to identify relevant topics and set priorities. This increases the report’s impact and ensures alignment with stakeholder expectations.
2. Ensure data quality
   Use systematic collection methods, validated processes, and transparent procedures to ensure data quality. This strengthens trust among all parties and supports informed decision-making.
3. Develop a communication strategy
   Tailor your communication to your target audiences and choose the right channels to effectively convey your results. This increases the impact of your sustainability initiatives.

With regular adjustments and a clear focus on growth, you can not only meet legal requirements but also strengthen your market position. As global expectations for transparency and accountability continue to rise, companies that lead in sustainability reporting are better positioned to build trust, attract investment, and drive long-term value.