How Microsoft Cloud for Sustainability Simplifies CSRD
Microsoft Cloud for Sustainability is a connected platform that helps organisations organise emissions data, resource use, supply-chain inputs, and operational records into a single, structured system. It supports consistent calculations across environmental metrics and links them to financial and operational data already used within the business, reducing fragmented reporting and duplicated work.
Microsoft Cloud for Sustainability provides a growing set of environmental, social, and governance (ESG) capabilities to help accelerate your sustainability journey.
When combined with a dedicated ESG platform such as Terra ESG Platform, this foundation becomes a practical sustainability reporting tool for companies preparing for CSRD. Together, they support a more structured, governed, and repeatable approach to ESG data management and disclosures.
In this blog, we look at how Microsoft Cloud for Sustainability and Terra ESG Platform work together as a CSRD reporting platform. We outline common reporting challenges, explain how the technology aligns with CSRD and ESRS requirements, and show how organisations can build a reliable sustainability reporting process using a modern sustainability reporting software.
Common CSRD Reporting Challenges
Before we look into Microsoft Cloud for Sustainability, it helps to outline the challenges commonly seen in meeting CSRD requirements. CSRD expects structured, traceable, and well-governed sustainability information across the whole organisation. Yet, many companies are still working with scattered tools, legacy data practices, and reporting routines that were never built for this level of detail. As a result, without a central ESG reporting platform, sustainability teams often spend more time managing data than producing meaningful insights or disclosures.
Organisations regularly encounter issues such as:
Fragmented data spread across spreadsheets, shared drives, and separate systems.
Inconsistent calculation methods for emissions, energy, waste, and water,
Missing or incomplete Scope 3 information from suppliers and partners,
Limited data lineage, making it hard to trace sources and assumptions,
Unclear ownership of metrics across departments,
Reporting workflows that rely on manual approvals and email chains,
Difficulty aligning operational data with ESRS structure and definitions,
Limited documentation needed for external assurance,
Delays caused by late updates or mismatches in format across teams.
These challenges create pressure across sustainability, finance, and operational teams. Clearly, a more structured foundation is needed before CSRD reporting can function as a reliable, repeatable process.
How Microsoft Cloud for Sustainability Aligns with CSRD and ESRS
CSRD requires structured data, clear documentation, and reporting workflows that can support internal review and external assurance. Microsoft Cloud for Sustainability offers capabilities that meet these expectations and help organisations organise their information to support ESRS requirements. Below is a closer look at how each capability contributes to CSRD-ready reporting.
1. Calculating environmental impacts
This capability helps organisations calculate emissions, energy use, and other environmental indicators consistently across business units. It supports Scope 1, Scope 2, and Scope 3 calculations, applies standard factors, and centralises the assumptions behind each number. This reduces discrepancies across departments and helps teams present figures that can be reviewed and validated with less back-and-forth.
2. Building a comprehensive ESG data estate
CSRD expects all sustainability data to be organised, traceable, and linked to the correct operational and financial context. This layer of the platform brings together data from facilities, supply chains, operational systems, and financial tools into a single environment. It supports structured tables, metadata, dashboards, and connections to internal systems, giving teams a clear overview of what information exists, where it comes from, and how it ties into ESRS indicators.
3. Strengthening data governance
Data governance is central for CSRD, as reports must be supported by verifiable evidence. This function assists teams in creating review steps, assigning responsibilities, documenting assumptions, and maintaining traceable workflows. It supports approvals, corrections, and version tracking, reducing the risk of undocumented changes and helping teams prepare for external assurance with more precise documentation.
4. Increasing value-chain transparency
Scope 3 and double-materiality assessments require information from suppliers, partners, and downstream activities. This part of the solution helps organisations gather and organise those inputs more consistently, reducing gaps and late updates. It makes it easier to understand upstream and downstream impacts, compare supplier data, and follow changes over time, which supports ESRS metrics linked to purchased goods, transport, distribution, and product use.
5. Reporting impacts and progress
Reporting workflows must follow the ESRS structure and create outputs that match CSRD expectations. This feature supports dashboards, structured templates, and data views that help teams prepare disclosures with clearer links back to their source data. It reduces repeated formatting work and helps sustainability, finance, and operational teams work from the same information during review cycles.
6. Modelling outcomes and forecasting
CSRD includes forward-looking metrics and requires organisations to assess how their actions influence future impacts. This part of the platform supports scenario modelling and projections based on emissions trends, energy consumption, and operational changes. It helps teams compare different approaches, prepare narrative explanations, and support strategic planning with consistent underlying data.
Together, these capabilities give organisations a more organised and reliable structure for CSRD reporting, reducing duplication and helping teams maintain a more apparent connection between data, assumptions, and final disclosures.
Practical Steps to Implement Microsoft Cloud for CSRD Reporting
Creating a reliable CSRD process requires structured data practices and tools that support consistent reporting. Microsoft Cloud for Sustainability offers the technical base, and the steps below outline how organisations can build a workable reporting cycle around it.
1. Review the current sustainability data estate
Document where data is stored, who owns each dataset, how metrics are calculated, and which areas rely on manual updates. This gives a clear picture of the gaps that need attention before CSRD work begins.
2. Map ESRS requirements to internal data sources
Match ESRS indicators with operational, financial, and supplier information. Highlight any missing inputs, unclear calculations, or areas where data does not meet CSRD’s expectations for traceability.
3. Configure Microsoft Cloud for Sustainability
Set up emissions calculations, value-chain inputs, governance steps, and connections to internal systems. This establishes a central environment for collecting, structuring, and preparing data for review.
4. Establish ongoing review cycles
Set up monthly or quarterly routines to update data, validate assumptions, and review documentation. This helps organisations avoid end-of-year bottlenecks and maintain a steady reporting process.
These steps provide structure for CSRD reporting and enable organisations to combine the capabilities of Microsoft Cloud for Sustainability with platforms built on it to create a reliable, repeatable workflow.
How Terra Reporting Leverages Microsoft Cloud for Sustainability
Terra ESG Platform is built on Microsoft Cloud for Sustainability and extends its core capabilities to support CSRD and ESRS reporting in a structured and audit-ready way. Microsoft Cloud for Sustainability provides the technical foundation for collecting, calculating, and governing ESG data, while Terra ESG Platform adds reporting logic, workflows, and methodologies aligned with European regulatory requirements.
A key area where Terra ESG Platform adds value is Double Materiality Assessment. The platform supports DMA by linking impact, risk, and opportunity assessments directly to underlying operational and environmental data. Scoring criteria, assumptions, thresholds, and outcomes are documented in a consistent and traceable way, supporting internal review and external assurance.
Terra ESG Platform also enables ESRS-ready workflows, including indicator mapping, narrative inputs, ownership assignment, and approval steps. By combining Microsoft Cloud for Sustainability’s data capabilities with CSRD-specific reporting workflows, Terra ESG Platform helps organisations reduce manual effort, improve consistency, and maintain a reliable, repeatable CSRD reporting process.
Conclusion
Microsoft Cloud for Sustainability provides organisations with a structured way to organise emissions data, operational records, and value-chain information in a single, connected system. This foundation makes CSRD reporting more reliable, supports clear data lineage, and reduces the manual work that typically occurs during disclosure season.
Terra ESG platform builds on this base by adding ESRS-ready workflows, documentation features, and collaboration tools that help teams prepare reports with fewer revisions and a clearer view of how each metric was created. It supports the whole reporting cycle, from data collection to internal review and final preparation of disclosures.
To see how your CSRD workflow can run with more precise data, fewer manual steps, and a more organised reporting cycle, book a demo.
Frequently Asked Questions (FAQ)
Microsoft Cloud for Sustainability is a connected platform that helps organisations manage sustainability data, calculate environmental metrics, and prepare ESG reports.
They include emissions calculations, ESG data organisation, governance tools, value-chain inputs, reporting features, and forecasting.
It centralises sustainability records, supports clear data lineage, organises ESRS-aligned information, and provides workflows suitable for audit and assurance needs.