Organizations are facing compliance challenges in sustainability reporting around the EU's Corporate Sustainability Reporting Directive and are looking to AI-driven solutions to improve data management and reporting accuracy
More than half (51%) of respondents stated that the European Union’s Omnibus proposals had affected their organization’s strategy around the EU’s Corporate Sustainability Reporting Directive (CSRD), according to the 2025 Sustainability Reporting Outlook, produced by Reuters Events. In addition, 42% of respondents said that managing the volume of data was a key challenge for CSRD compliance.
One of the major tailwinds that could positively impact the data volume challenge — and the data challenge more broadly — is AI adoption at an early stage for sustainability reporting. Nearly 90% of respondents to the Outlook research said they expect AI to have a material impact on sustainability reporting, compared to 67% who said the same in last year’s survey.
For those organizations which already are using AI, it is revolutionizing sustainability reporting by enhancing data collection, monitoring, and analysis processes. With the capability of efficiently managing vast datasets to help to improve the accuracy and reliability of sustainability reports, these technologies automate resource-intensive tasks and create additional bandwidth for sustainability professionals to focus on strategic sustainability initiatives.
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In fact, leading organizations which have more ambitious reporting scopes are likely to have transitioned away from storing sustainability data manually and instead embraced technology tools to assist with data collection, analysis, and reporting. Interestingly, leaders of these organizations are also more likely to anticipate AI having a significant impact on reporting practices, which is most likely attributable to them having already experienced using technology in their sustainability data processes. Indeed, half are already using AI to support sustainability reporting, according to Reuters Events research.
In addition, emissions reporting is another area in which the use of AI is increasing efficiency and effectiveness. More specifically, 37% of respondents from organizations reporting Scope 1, 2, and 3 emissions with assurance are already leveraging AI in their reporting processes, while just 22% said they are currently using AI to support reporting today without external assurance.
Another primary use case is utilizing AI in materiality assessments. This is also an area that respondents say is a priority for investment over the next three years, although it is not as popular as it was in last year’s study. There is at least some indication that sustainability practitioners believe the technology is not yet mature enough for widespread use.
AI won’t solve data and reporting challenges completely
As organizations increasingly integrate AI into sustainability reporting, they encounter several challenges that must be addressed to realize the technology’s full potential. Data quality and the cost of integrating new technology into existing systems are two key areas of concern. In fact, 50% of respondents in the Reuters Events research highlighted data quality as a significant concern. Poor data quality can undermine the accuracy of AI-driven insights, and as a result, it is crucial for organizations to invest in robust data governance practices.
Additionally, integrating AI technologies can be costly and complex. Indeed, it requires careful planning and execution to ensure seamless functionality within existing systems. External assurance becomes vital in this context, providing independent verification of data accuracy and bolstering confidence in AI-driven reports. Organizations must prioritize these considerations to harness AI effectively, ensuring that sustainability reporting is both reliable and insightful. This approach will help overcome obstacles and drive meaningful progress in sustainability practice.
Technology seen as a key driver of efficiency
While AI is not expected to impact sustainability reporting for a while, technology is still seen as a key enabler for CSRD compliance. The popularity and adoption of reporting-related tools continues to evolve over time. According to the chart below, the top three tools in 2025 and those that are expected to be most popular in 2028 are internal data solutions, supplier surveys and audits, and data platforms for environment, social & governance (ESG) initiatives.
Procuring the right tool or technology can be critical for organizations that want to become more efficient and effective in their sustainability reporting, but so often this comes down to selecting the right vendor. In fact, sustainability practitioners are most likely to be driven by cost when it comes to selecting vendors. More than three-quarters (76%) of respondents identified cost as a key selection criterion for vendors, a greater share than the 61% of respondents who did so in last year’s survey.
This is why it is essential to balance investing in AI-enabled technology solutions, improving data governance, and seeking external assurance to ensure data accuracy and integrity. This process involves developing comprehensive strategies for managing data volume and quality, in order to bolster confidence in AI-driven reports and facilitate seamless integration within existing systems.
The EU’s Omnibus proposals have undeniably influenced CSRD strategies. As data management challenges persist, AI adoption presents a promising solution but only when accompanied by effective governance, assurance, cost effectiveness, and proper vendor selection.
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