It’s not enough to talk about it anymore: seven priority sustainability topics are on the agenda of Hungarian companies

The length of the reports examined showed significant differences: the shortest was 33 pages, the longest was 412 pages, while they averaged 120 pages. The most comprehensive documents can be linked to the financial sector, where both investor expectations and regulatory compliance require detailed content. Almost half of the companies analyzed, while the majority of companies in Hungary (58%) already have an internal reporting policy that records how the company prepares its sustainability reports. Almost all reporting entities (88%) have a sustainability strategy, while eight out of ten companies have a dedicated ESG manager.

On average, companies identified seven focus areas in their Double Materiality Assessment (DMA), which examines which sustainability impacts are significant to the company and its value chain, and what financial risks and opportunities they may pose. Of these, climate change was typically relevant across all industries, with only very good justification for omission, while disclosures about their workforce and corporate governance were also relevant across industries. The circular economy, workers in the value chain, consumers and end users, and biodiversity and ecosystems were also important topics on the agenda of the 216 companies.

“The CSRD reports provide a picture of the sustainability maturity of the companies concerned for the first time. The next step is for the data-driven, strategic approach to become part of daily operations and for companies to develop the necessary content and formal framework for this,” emphasized Ákos Lukács, Partner in the Climate Change and Sustainability business line of EY. “Organizational integration of sustainability is essential for this, the key to which is the development of a common goal system, clear responsibilities and clear incentive processes,”

the EY expert added.

Companies should also evaluate reporting from a business perspective, with particular attention to the dual materiality assessment. For successful data provision, it is essential to strengthen the organizational and IT background, establish an appropriate internal control environment, and effectively manage complex data sources – such as transition plans and climate risks. The goal is to improve sustainability performance and create business value beyond compliance. Decision-makers can achieve this by improving ESG ratings, exploiting green financing opportunities, and consciously addressing risks.