Assessing the Sustainability Reporting in the Energy Industry in Finland
Nikoloska, Frosina (2024)
2024
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2024051311364
https://urn.fi/URN:NBN:fi:amk-2024051311364
Tiivistelmä
This bachelor’s thesis examines sustainability reporting in the Finnish energy industry in anticipation of the Corporate Sustainability Reporting Directive (CSRD), effective from 2024 onward. The CSRD enhances corporate transparency in sustainability by expanding the scope and depth of non-financial reporting in the European Union. The study aims to evaluate the preparedness of three large Finnish energy companies – Fortum, Neste, and Wärtsilä – to meet the new reporting standards mandated by the directive. The research seeks to understand how these companies' reports for 2022 and 2023 align with criteria and features of the CSRD. It focuses on their current disclosure of environmental, social, and governance (ESG) topics.
The thesis comprises a theory section detailing the evolution of sustainability reporting frameworks and standards and the current legislative changes affecting them. This is followed by an empirical section analysing the sustainability reports of the selected companies. Using qualitative content analysis, the study categorizes and assesses the ESG disclosures within the companies' sustainability reports for 2022 and 2023. The analysis uses a coding framework to classify the reports according to predefined themes against the criteria and features of the CSRD.
The study revealed a proactive approach by Fortum, Neste, and Wärtsilä towards adopting the CSRD's reporting requirements ahead of the 2024 mandate. All three companies have incorporated CSRD-aligned practices in their sustainability reporting for 2022 and 2023. This showcases substantial compliance with the CSRD’s disclosure standards on ESG information. The companies exhibited extensive coverage across all topics, particularly in environmental aspects. They demonstrated advanced readiness by setting ambitious, quantifiable sustainability targets and reporting the yearly progress towards them.
The findings indicate a strong alignment with CSRD guidelines among the three Finnish energy companies. Thus, the companies demonstrate high levels of preparedness in its implementation in their sustainability reporting for the following year. However, there is room for improvement in standardizing disclosures to fully meet the CSRD's extensive and cross-thematic reporting criteria. The study advocates for ongoing adjustments in reporting strategies to address the regulatory expectations. Further research is recommended in assessing the sustainability reporting after 2024 to analyse changes resulting from the formal application of the CSRD.
The thesis comprises a theory section detailing the evolution of sustainability reporting frameworks and standards and the current legislative changes affecting them. This is followed by an empirical section analysing the sustainability reports of the selected companies. Using qualitative content analysis, the study categorizes and assesses the ESG disclosures within the companies' sustainability reports for 2022 and 2023. The analysis uses a coding framework to classify the reports according to predefined themes against the criteria and features of the CSRD.
The study revealed a proactive approach by Fortum, Neste, and Wärtsilä towards adopting the CSRD's reporting requirements ahead of the 2024 mandate. All three companies have incorporated CSRD-aligned practices in their sustainability reporting for 2022 and 2023. This showcases substantial compliance with the CSRD’s disclosure standards on ESG information. The companies exhibited extensive coverage across all topics, particularly in environmental aspects. They demonstrated advanced readiness by setting ambitious, quantifiable sustainability targets and reporting the yearly progress towards them.
The findings indicate a strong alignment with CSRD guidelines among the three Finnish energy companies. Thus, the companies demonstrate high levels of preparedness in its implementation in their sustainability reporting for the following year. However, there is room for improvement in standardizing disclosures to fully meet the CSRD's extensive and cross-thematic reporting criteria. The study advocates for ongoing adjustments in reporting strategies to address the regulatory expectations. Further research is recommended in assessing the sustainability reporting after 2024 to analyse changes resulting from the formal application of the CSRD.