CSRD: Simplified ESG reporting thanks to real-time fleet data
Once it takes effect in 2024, the Corporate Sustainability Reporting Directive (CSRD) will require affected companies to track and disclose, in addition to their financial statements, an ESG (environmental, social, and governance) report—often referred to as “non-financial”—because it focuses on non-monetary information, particularly the impacts and risks on the environment, society, people, and the company’s entire ecosystem.
Given that transportation accounts for 25% of CO2 emissions in Europe, according to figures fromthe European Environment Agency, the environmental impact of a company’s vehicle fleet must be a key focus of the ESG reports companies are required to publish. To help them consolidate information and prepare this report, the transmission of real-time vehicle data to a single interface will be of great assistance to the finance department.
Vehicle Fleet: The Importance of Tracking CO2 Emissions
A requirement that is set to apply to a growing number of companies as the application thresholds evolve. Furthermore, a company not subject to the CSRD but acting as a subcontractor or supplier to another company that is subject to it may itself be required to submit an annual CO2 impact report. In this new legislative context, the ability to provide reliable and structured information on its CO2 emissions will increasingly become a competitive advantage for a company, even a small one.
However, CSRD regulations are not necessarily the only reason to track a company’s CO2 emissions. In fact, the Climate and Resilience Act (published in the Official Journal on August 24, 2021) establishes a new target of 70% low-emission vehicles in fleet renewals by 2030. At the same time, the Mobility Orientation Law requires companies to prioritize vehicles emitting less than 60g of CO2 per km when renewing their fleets. The goal is to prepare managers, drivers, and the public for an all-electric future, with a ban on the sale of new internal combustion engine vehicles set for 2035.
Until that deadline arrives, monitoring the fleet’s CO2 emissions on a daily basis is the only option available to decision-makers:
- To assess the current situation and determine the scope of the work to be done
- To quantify the changes needed to make progress and comply with future standards
- To implement the energy transition at its own level through appropriate decisions
- To track the project's progress
- To communicate about the topic both internally and externally
Several assessment methods
The question remains as to how to assess and monitor the environmental impact of using these fleet vehicles over time, particularly CO2 emissions. To do so, there are two possible solutions:
- An estimate based on the number of kilometers traveled and fuel consumption
- Accurate cost estimates based on actual vehicle fuel consumption data
While the first method has the advantage of requiring no investment, it nevertheless has a number of drawbacks. First and foremost is the need to compile, at the company level and over an entire year, data on all trips taken. This will therefore entail a significant amount of administrative work. Next, an average fuel consumption must be assigned to each vehicle in the fleet in order to perform the calculation. The result will inevitably be imprecise, as the official fuel consumption figures provided by manufacturers can differ significantly from those observed under real-world conditions. Hence the need for a solution capable of transmitting the vehicle’s actual fuel consumption, as measured at any given moment by its flow meter.
Vehicle data for emissions monitoring
To enable the implementation of this second technique, Echoes’ Carfleet solution relies on real-time data transmitted directly from the vehicles to the manufacturer via an onboard 4G/5G chip. This data is generated by the numerous sensors found in modern vehicles, ranging from the odometer and flow meter to the speedometer and the traction battery charge level.
Consolidated into a dedicated interface, this data can be analyzed and exported for use in analysis. This data includes, over a time period to be defined by the user:
- The exact composition of the connected fleet
- The total mileage traveled by the vehicle fleet
- Total fuel consumption by internal combustion engine vehicles
- Total CO2 emissions from internal combustion engine vehicles
- Total energy consumption of electric and plug-in hybrid vehicles, in kWh
CarFleet: A Solution for Monitoring and Taking Action
Better yet, CarFleet offers a wide range of features that allow you to track your fleet’s fuel consumption on a daily basis and take the necessary steps to manage and reduce it:
- Geolocation and trip history to optimize routes and choose the most fuel-efficient ones
- The average fuel consumption of vehicles, which allows for action to be taken against drivers and/or vehicles with abnormally high figures.
- Mechanical alerts, particularly those related to tire pressure. In fact, underinflated tires can increase fuel consumption by up to 10%
- Monitoring the charging status of plug-in hybrid vehicles, which helps identify vehicles that are not charged or are only partially charged—and therefore consume excessive amounts of fuel
Thanks to Echoes’ exclusive “Vehicle Data as a Service” technology, the CarFleet solution enables you to meet CSRD reporting requirements and track your fleet’s CO2 emissions—without any commitment or the need to install any devices on your vehicles.
Who is subject to the CSRD, and when?
| Business Categories | Reference fiscal year – fiscal year beginning on: | Report published as of: |
Large European and non-European companies subject to the NFRD thresholdsEuropean public-interest entities (as defined by the Accounting Directive—which include European companies listed on a regulated European market) and non-European companies listed on a regulated European market that meet both of the following criteria:
| January 1, 2024 | 2025 |
Other major European and non-European companiesAll other European companies that meet at least two of the following three criteria:
All non-EU companies listed on a regulated EU market that meet two of the three criteria mentioned above. | January 1, 2025 | 2026 |
| SMEs listed on a regulated European marketAll EU and non-EU SMEs listed on a regulated European market, except for microenterprisesMicroenterprise: a company that meets no more than two of the following criteria: 10 employees, €350,000 in total assets, €700,000 in revenue(1). | January 1, 2026 – may be postponed to 2028(2) | 2027 – may be postponed to 2029(2) |
| Other major non-European companies: Certain non-European companies with European revenue exceeding €150 million and a subsidiary or branch based in the European Union. | 2028 | 2029 |
Source: Autorité des Marchés Financiers (AMF) The new CSRD Directive on corporate sustainability reporting | AMF (amf-france.org)