Empowering Irish SMEs: Navigating CSRD Compliance for Sustainable Growth

As CSRD becomes a greater driving force within the Irish market, more support is needed to enable mid-sized businesses to meet the challenge – our recent survey found that three in ten businesses are aware of the CSRD. Similarly, we found that cost is the biggest barrier to action in the market and that 71% of businesses are concerned about the initial capital investment required for implementing green initiatives. 

These findings are underscored by recent studies that compare Ireland with European and Global benchmarks. Grant Thornton’s report, entitled The Journey to a Sustainable Future found that ESG compliance is becoming a key challenge for mid-sized Irish businesses as over half perceive them as a barrier to international expansion, a recent study has found. The findings follow the implementation of the first round of CSRD as mid-sized businesses may have to provide sustainability information to large companies in their value chain.

The study also found that the top concern for businesses regarding compliance with ESG and sustainability regulations is the amount of staff and time resources needed to achieve compliance (38%). This is followed by the rapid pace of changing requirements (33%) and the capital investment required (29%).

These challenges translate into a lag behind European and Global standards. While 42% of Irish respondents have established sustainability strategies and targets (compared to 75% globally), 41% of Irish businesses still lack basic ESG/sustainability frameworks—such as strategies, policies, reporting, evaluation, data collection, programs, governance structures, and budgets—compared to just 8% globally. Furthermore, 40% of mid-sized businesses have no plans to implement sustainability measures (such as policy, strategy, or reporting) within the next 12 months.

Falling behind their European and North American counterparts, Ireland’s mid-sized firms require support to advance in their sustainability efforts. Such support includes education about the upcoming CSRD requirements and financial models that enable companies to take action. This is critical to general competitiveness, both internationally and in domestic markets. 

Source: EPA – Assessment of Compliance

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Author: Will Penn | Energy Associate Manager | UrbanVolt