The introduction of the Corporate Sustainability Reporting Directive (CSRD) is one of the greatest shifts in corporate reporting in decades. Its aim is to drive sustainable behaviour and ultimately, foster company innovation in respect of sustainable operations.

The first wave of reporting will see Public Interest Entities and companies listed on an EU regulated market which are large and have more than 500 employees report in 2025 on 2024 results.

In the second wave of reporting, for fiscal years beginning from 1 January 2025 (reporting in 2026), all other large EU companies/groups will be required to report.

Large companies/groups are those that on the balance sheet date exceed two of the following three criteria: 250 employees, net revenue of €50 million, or total assets of €25 million.

It is likely that many of our co-ops in Ireland will be included in this second wave of reporters. However, it is important to highlight the scale of the directive’s reach to all aspects of food production, particularly to many of the smaller operators in the sector.


The requirements to disclose are dense, far reaching in terms of scope and scale, and without doubt, companies that come into scope of CSRD are well advised to start preparation early.

Lorraine Sammon, audit partner, KPMG, examines the impact of the EU CRSG directive.

Many will be familiar with various elements of the reporting, but two of the key concepts that really push the boundary are double materiality (a key feature of CSRD reporting) and value chain analysis (a more common concept in sustainability reporting).

Double materiality means that companies not only have to disclose the financial risks they face from climate change and other ESG matters (financial materiality) they also have to report on the impact they have on the environment and society (impact materiality).

One of the key topics that dairy co-ops will need to disclose is emissions, including emissions at farm level

Reporting in respect of a company’s value chain means considering the impacts of actors upstream from the undertaking (e.g. suppliers) and actors downstream from the undertaking (e.g. distributors, customers).

CRSD through a co-op’s lens

Some co-ops will be well advanced on their CSRD readiness assessment, while others will be at a more initial phase. For those at an earlier stage, given the breadth of requirements, it is worthwhile examining what does it really mean for a typical dairy co-op in Ireland.

What are some of the likely disclosures a company will need to make to their stakeholders as part of CSRD?

The easiest way to understand some (and certainly not all) of the areas that will need to be reported on is to step back and start at the farm level.

The farmer will be one of the main suppliers to the co-op (milk) and is therefore a key actor in the upstream value chain. Therefore a co-op will need to consider what impacts, risks and opportunities the farmer generates from a sustainability perspective.

The first area here to consider will be climate change – both in terms of how dairy farming impact climate change, and also, how climate change will impact on dairy practices.

In terms of dairy farming impact on climate – one of the key topics that companies will need to disclose is emissions (this is typically a material area for most companies).

For a co-op producer, a significant % of emissions will relate to scope 3 emissions at the farm level (generally methane from cows).

These will now need to be disclosed and co-ops will need to determine an efficient way to obtain this information from their farm suppliers.

Impact of climate change

Secondly, a co-op will need to examine the impact of climate change on dairy practices.

Already in 2024, Ireland has experienced record rainfall, and changing weather patterns are having a real impact on farming, with increased rainfall meaning more feed and less grazing.

This is a real risk for farms and co-op producers, and it is likely that in time, co-op producers will need to quantify this risk as part of their CSRD reporting (and disclose the estimated financial impact). Therefore, decarbonisation of operations will continue to be a real focus of business strategy for co-ops.

Still at the farm level, the impact on biodiversity loss needs to be assessed and is likely to be material for many co-op producers.

This will mean that co-ops will need to disclose how they have considered this impact, and set out their policies, actions and targets in relation to biodiversity.

Examples of some other areas to consider for reporting at the farm level will be animal welfare (most customers will expect high standard treatment of farmers’ cows) and workers in the value chain (eg health and safety issues on farm).

For these, as with climate change and biodiversity, co-ops will need to disclose various metrics if they are deemed to be material. Critically, for all of these matters, it is clear that data flows from farm to co-op will need to increase so that co-ops can reliably report this information.

Moving along the value chain

Moving down the value chain from the farm level to the co-op’s own manufacturing facilities, examples of areas to consider for reporting are resource use such as plastic packaging and also the amount of waste generated from operations.

The information required for disclosure in respect of these type of areas are often easier to obtain than upstream in the value chain, and many companies will look at these areas and see an opportunity to drive innovation in their operations through more sustainable packaging and more efficient waste management practices.

In the downstream value chain, the co-op’s consumers and end users are likely to be one of the areas that will require consideration from a sustainability reporting perspective.

This may relate to safety of food products but also, more and more, it will relate to dietary changes and the impact on the organisation and finally, as more information is disclosed on a company’s sustainability practices, the value that the customer places on sustainability could also have a financial impact.


The analysis above lends a very high-level lens to the impacts that CSRD reporting will have on co-ops.

There will be many more sustainability matters to consider and report on, but through the analysis above, it is clear that compliance with CSRD will have a number of impacts for both co-ops and farmers.

For co-ops, there will be increased accountability through the requirement to report on emissions, water usage, waste and workforce to name but a few.

This is likely to continue to encourage food producers to innovate and continue to embed sustainability principles throughout their operations, which may also lead to a market differentiating opportunity.

For the farmer and smaller suppliers, it will mean increased data requirements, cost considerations and a need to continuously focus on sustainable agriculture. For the consumer, it means more information on what they are choosing to buy and who to buy it from – and this will be a key determinant of market success.

While there is undoubtedly an increased compliance requirement, there is also reason to be very optimistic.

Through enhanced and more consistent reporting of ESG matters, the CSRD will ultimately drive sustainability and innovation in companies throughout the supply chain.

This is to be welcomed as it is this type of corporate innovation that will fast-track countries achieving sustainability targets and ultimately allow for the achievement of the sustainability goals set at a global level.