/>iThe Corporate Sustainability Reporting Directive (CSRD) Implementation Act was debated in the German Parliament (Bundestag) at first reading on 26 September 2024. The aim is to fulfil the European Commission requirements within the timeframe given by the infringement notice.
The CSRD requires EU Member States to transpose the directive into national law. In Germany, the CSRD transposition has led to revisions to:
- German Commercial Code (HGB)
- German Stock Corporation Act (AktG)
- German Limited Liability Companies Act (GmbHG)
- German Cooperatives Act (GenG)
- German Securities Trading Act (WpHG)
- German Supply Chain Due Diligence Act (LkSG)
- German Auditor’s Ordinance (WPO)
The sustainability reporting obligation depends primarily on the size of the company and its capital market orientation. The obligation applies to financial years beginning on or after:
- 01 January 2024 – For companies that are already subject to the obligation to issue a non-financial statement
- 01 January 2025 – For all other large companies
- 01 January 2026 – For capital market-oriented small and medium-sized enterprises
- 01 January 2028 – For certain companies from third countries with a relevant EU connection
Therefore, in 2025 the reporting applies to large entities that exceed at least two of the three following characteristics:
- Comprising more than 250 employees
- Balance sheet of more than €25 million
- Sales revenue of more than €50 million
In addition, a listed company on an EU regulated market is always deemed to be a large corporation.
As with the CSRD, this is a very complex area of legislation, with penalties for noncompliance. For companies operating in Germany, we suggest reading our deep dive into the German implementation by our in country experts.
