Sustainability & ESG - more than just key figures
The abbreviation ESG stands for Environmental, Social, Governance - and describes the three central topics of sustainable corporate management. However, ESG is far more than just a reporting standard. It characterises the financing conditions of companies, influences investment decisions and is increasingly becoming a criterion in the assessment of corporate risks.
A well thought-out sustainability strategy therefore involves far more than just collecting and analysing ESG data. It requires the integration of environmental and social objectives into the financial strategy, investment logic and risk assessment. Finance departments play a key role here: they ensure that sustainability is systematically managed and transparently reported - so that reporting creates a real added value for the company.
Sustainability must be part of the corporate strategy - not just of reporting
Sustainability is evolving from an image issue to a core question of corporate management. Companies are formulating increasingly ambitious ESG targets - but a closer look reveals that the integration of these targets into the corporate strategy is still in its infancy in many places.
Sustainability aspects are often treated primarily as a reporting issue - driven by regulatory requirements such as the EU CSRD (Corporate Sustainability Reporting Directive). However, there is often a lack of consistent anchoring in financial management, investment decisions or risk management structures.
Today more than ever, CFOs and finance leaders are at the centre of this transformation. They have a responsibility not only to document sustainability goals, but also to integrate them into operational and strategic management systems. ESG does not just belong in the sustainability report - ESG belongs in the corporate strategy.
New roles, new requirements: ESG becomes a matter of resources
It is also clear that ESG issues have a profound impact on management, risk management and reporting. The requirements for finance teams are changing accordingly. What is needed:
- ESG controllers with reporting and regulatory expertise
- Sustainability analysts who can understand and evaluate data sources
- ESG project managers who coordinate ESG projects and processes across departmental boundaries
CFOs are faced with the task of either building up these competences internally - or recruiting externally in a targeted manner. The competition for ESG talent is already noticeable, particularly in regulated sectors such as financial services, the industrial sector and life sciences.
The simplification Omnibus 1: extended deadlines - but no free ride
In February 2025, the EU responded to the massive pressure from many companies with the simplification Omnibus 1. The "stop-the-clock" proposal: the mandatory application of individual ESRS standards is to be postponed by two years. This mainly affects industry-specific standards and standards for non-European companies (source: European Commission, 2025).
What does this mean for German companies in concrete terms?
- The basic obligation for ESG reporting from 2025 remains in place.
- However, some specific disclosure requirements may be applied later.
- The aim of the package is to give companies more time for implementation - without giving up the overall goal of transparency.
Simplification omnibus is the European Commission's response to the strong criticism from numerous businesses, organisations and companies, who considered the tight timetable and high requirements to be difficult to implement. The package is part of a broader initiative to "streamline" European reporting obligations under the slogan "Reducing Reporting Burden".
Important: The postponement should not be seen as an invitation to wait and see. On the contrary - the time gained offer CFOs and finance teams the opportunity to create structures and recruit suitable specialists.
Which companies in Germany are affected by the postponement?
For the time being, only companies with more than 1,000 employees and either an annual turnover of more than 50 million euros or a balance sheet total of more than 25 million euros are required to provide an ESG reporting. This adjustment to the thresholds means that many SMEs that were previously subject to the reporting obligation are now temporarily exempt (source: Rödl & Partner, 2025)
In addition, the deadline for the first-time application of the CSRD reporting obligation for companies that were not already subject to the previous regulations has been postponed by two years. This means that affected companies will now only have to prepare a sustainability report for the 2027 financial year, which will then be published in 2028 (source: Terra Institute, 2025)
These changes are intended to reduce the administrative burden on companies and give them more time to prepare for the ESG reporting requirements. Nevertheless, it remains crucial for CFOs and finance managers to implement the necessary structures and processes at an early stage in order to meet future requirements.
What the postponement means for CFOs in Germany
For CFOs in Germany, the simplification omnibus offers a strategic preparation phase:
- As planned, the sustainability reporting obligation will apply to large companies from the 2025 reporting year, i.e. from publication in 2026.
- The scope of the requirements will be staggered - but the essential core elements such as double materiality analysis, data review and governance disclosure will continue to apply.
- Integration into existing financial reporting systems is becoming a central task - and is the responsibility of CFOs.
For financial managers, the postponement means one thing above all: acting strategically now. The additional months should be used in a targeted manner to:
- Establish data processes and interfaces for ESG key figures
- Clarify governance structures and responsibilities
- and above all: recruiting suitable personnel with ESG expertise or training existing staff
Conclusion: Now is the right time to set the course
The simplification omnibus 1 offers many German companies a real gain in time - not for procrastination, but for targeted preparation.
For CFOs, this means that sustainability is moving further into the centre of the financial strategy from a legal perspective . If you not only want to achieve regulatory compliance, but also want to be ahead of the game, you need to create the right structures and build up expertise today.
