EU climate reporting gets real — and that is a good thing

Jane Thostrup Jagd is director net zero finance at the We Mean Business Coalition

Thanks to the CSRD, companies are starting to treat climate reporting like financial reporting, with discipline, data and oversight

Something big just happened in European corporate reporting — and most people have not noticed.

For the first time, our team at We Mean Business Coalition has looked closely at how the 100 largest listed companies in the EU are reporting on climate under the Corporate Sustainability Reporting Directive. And the findings are clear: companies are moving beyond vague pledges and glossy pictures into the hard territory of accountability.

We reviewed thousands of pages of climate disclosures and, above all, one truth stood out: regulation works. Companies that follow clear, mandatory rules are producing far more useful and credible climate information than those sticking to voluntary standards.

This is what progress looks like

Let us be honest — climate reports have not always been known for clarity or credibility. For years, we have seen vague commitments, cherry-picked data and plenty of green spin. But the CSRD is changing that. It is no longer just about saying the right thing, it is about showing your working.

We are seeing disclosures that help investors and stakeholders understand a company’s exposure to climate risks, and what they are doing about it. Companies are stress-testing their business models against different climate scenarios. They are linking emissions to financial performance and, in many cases, they are even restating earlier reports when mistakes or gaps come to light.

In other words, they are taking climate reporting seriously.

Real-world reporting

What made this review exciting was seeing how companies are coming up with creative, practical ways to meet the new standards. We found examples of companies developing clear carbon accounting principles, setting science-based targets that are auditable, and outlining how climate issues affect their bottom line.

Some companies are beginning to connect climate risks with their financial statements — for instance, by integrating climate variables into impairment testing and provisioning, which shows up where it matters most: on the balance sheet. Others are backing their net zero targets with transition plans so detailed and well prepared that it is possible to see the individual levers and the associated costs of achieving them.

These are not just technical fixes. They are signs that companies are starting to treat climate reporting like financial reporting: with discipline, data and oversight.

The power of being held to account

It is clear what is driving this shift: regulation and assurance.

Voluntary frameworks helped build early momentum, but they often left too much room for interpretation. The CSRD, in contrast, sets a clear bar, and with reports subject to independent assurance, the quality is improving fast. Knowing that an auditor will be double-checking the data and methods changes the game.

It also means companies are more willing to say, “we don’t know yet” or “we are still working on this” — and that is a good thing. Honest reporting, even if incomplete, is more valuable than perfect-sounding spin. It gives everyone a clearer view of where the gaps are and what needs to happen next.

Companies are developing clear carbon accounting principles, setting science-based targets that are auditable, and outlining how climate issues affect their bottom line

While there is much room for optimism, the quality of these 100 reports varies considerably. Some companies are still struggling with key areas such as political influence and lobbying — a blind spot in many reports. Others remain hesitant to disclose how climate risks affect their core strategy or financial outlook, despite growing pressure to do so.

We also see companies struggling to fully comply with the regulations — and, in some cases, they and their auditors seem to assume that readers and users will not notice when things do not add up. But when logic fails, trust falters. That will need to improve.

Tools for the journey

Our findings and insights from this review are contained in a report released this week, Inside the CSRD Climate Reports: the Beginning of a New Accountability Era.

To help companies deliver even better reporting next year we have included practical tools and resources at the end of each chapter — from audit-ready checklists to links to technical guidance and best-practice examples.

We want this to be more than just a review. It is a how-to guide for companies and auditors navigating this new landscape.

What comes next?

Climate reporting in Europe is growing up. It is becoming more grounded, more useful and more honest. But that progress did not happen by accident. It happened because regulators raised the bar — and companies stepped up.

We are now entering a phase where climate disclosures are not just communication tools, but decision-making tools, ones that can inform strategy, drive accountability and move capital.

While the headlines might still focus on emissions targets and net zero deadlines, the real story is in the footnotes: companies are finally starting to back up their climate claims with credible, usable data. That is something to pay attention to — and build on.