5 Most Common CSRD Mistakes and How to Avoid Them

Preparing for the Corporate Sustainability Reporting Directive (CSRD) is already on the agenda for thousands of companies. Deadlines are set, data requirements are detailed, and expectations are high. Many businesses, though, still fall into easily predictable traps that make CSRD reporting more complicated than it has to be.

This article highlights the five most common CSRD mistakes and provides guidance on how to avoid them. Think of it as a guide through the biggest CSRD challenges with practical, straightforward, and action-focused tips

Mistake 1: Thinking “We Still Have Time”

It’s easy to believe there’s still plenty of time before CSRD deadlines hit. Reporting often feels like a non-urgent task, especially when day-to-day operations take priority. However, this mindset usually leads to delayed materiality assessments, rushed data collection, and last-minute submissions, resulting in incomplete reports, miscommunication across teams, and limited opportunity to correct mistakes before assurance reviews begin.

How to avoid it:

Treat CSRD as a long-term project, not a one-off deadline. Create a backward timeline starting from your official reporting date and define milestones for each stage. Involve stakeholders early, plan buffer periods for validation and feedback, and establish a routine for data collection throughout the year. A proactive approach ensures quality, reduces last-minute stress, and builds internal accountability.

Watch our latest video series that discusses the impact of delaying compliance, how to make better use of preparation time, and why investing in data early pays off.

Mistake 2: Misunderstanding Double Materiality

Many organisations assume they can focus solely on financial risks or solely on environmental and social impacts and still comply with regulations. This partial approach misses the essence of CSRD. A company that evaluates only financial implications may overlook the impact of its operations on people and the planet. Conversely, focusing purely on environmental factors without a financial context weakens strategic insight and stakeholder trust.

How to avoid it:

Conduct a comprehensive double materiality assessment that reflects both perspectives: impact materiality and financial materiality. Engage representatives from finance, sustainability, operations, and risk management to ensure balanced input and perspectives. Document your reasoning clearly so readers understand why specific topics were prioritised. Revisit the assessment regularly, especially when your business model or market conditions change.

Check out The Step-by-Step Guide for a Double Materiality Assessment for a complete walkthrough on double materiality.

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Mistake 3: Poor Data Quality and Inconsistency

Data collection for CSRD reporting often starts with good intentions but quickly becomes fragmented. Teams track metrics differently, spreadsheets go missing, and inconsistent definitions emerge across departments. This inconsistency leads to unreliable data, audit challenges, and difficulty comparing performance year over year. Companies often rely on unclear definitions and siloed processes, resulting in inconsistent numbers that cannot withstand audit scrutiny, making year-on-year comparisons unreliable.

How to avoid it:

Start by standardising what data you collect and how you define each metric. Introduce shared templates and centralised databases instead of individual spreadsheets. Implement version control and internal checks to ensure accuracy and consistency throughout the process. Regularly review data throughout the year rather than waiting until the final report. Automation tools can help validate inputs, detect inconsistencies early, and prepare your information for audit faster.

Want to learn more about how improved data management can help you reach reporting maturity? Check out the “ Achieving ESG Reporting Maturity Through Better Data Management blog for guidance.

Mistake 4: Treating Sustainability as a Checkbox

For many companies, CSRD reporting is viewed as merely a document to submit, rather than a tool for transformation. When sustainability is viewed only through the lens of obligation, reports become generic, disconnected from strategy, and uninspiring for both investors and employees.

How to avoid it:

Link sustainability to business goals, link reporting topics to strategic objectives and KPIs. Encourage collaboration between finance, HR, and operations so sustainability becomes a shared responsibility, not an isolated task. Use reporting outcomes to inform decisions on product design, procurement, or risk planning. Over time, this shift transforms compliance into an opportunity to drive innovation, attract top talent, and enhance stakeholder engagement.

Mistake 5: Overlooking supply chain and value chain impacts

Many organisations limit their focus to direct operations, where data is easiest to access, while neglecting upstream and downstream effects. However, CSRD expects companies to account for their entire value chain. Ignoring suppliers or product life cycles can create gaps in reporting, expose companies to criticism, and lead to assurance failures.

How to avoid it:

Start by mapping your full value chain and identifying where the biggest sustainability risks and data gaps lie. Work closely with suppliers and partners to collect reliable information and verify assumptions. Where precise data isn’t yet available, explain estimation methods transparently. Establish long-term data-sharing frameworks to improve quality and build stronger partnerships continuously. Over time, this approach increases credibility and demonstrates accountability beyond your own operations.

How technology helps avoid CSRD challenges

Many of these CSRD mistakes have a common root: scattered data, manual processes, and a lack of structure. Thankfully, modern ESG platforms simplify the entire reporting process by centralising information, automating data collection, and keeping everything audit-ready.

Tools like the Terra ESG platform help companies:

• Collect and store sustainability data in one place, rather than chasing spreadsheets.

• Run consistent double materiality assessments with clear documentation.

• Track supplier data through structured workflows

• Generate audit-ready reports aligned with CSRD requirements

By utilising technology, organisations can reduce the risk of errors and free up resources to focus on their strategy. It transforms CSRD reporting from a stressful compliance exercise into a structured, manageable process.

In Conclusion

The most common CSRD mistakes stem from waiting too long, misunderstanding double materiality, struggling with data, treating reporting as a box-ticking exercise, or overlooking the impacts on the supply chain. These are the CSRD challenges that repeatedly appear.

Utilising a sustainability platform like the Terra ESG Platform helps simplify reporting, enhance data accuracy, and link sustainability efforts to tangible business outcomes. With the right ESG tool, CSRD compliance becomes an ongoing process that supports smarter decisions and long-term value.

Are you ready to simplify your CSRD reporting? Discover how the Terra ESG platform can help.

Frequently Asked Questions (FAQ)

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