New reporting year and ESG targets assurance: don’t invent – name what you already do

The new reporting year is the moment when ESG targets stop being a “nice add-on” to the strategy and become a hard element of the report – one that an external party will verify as part of the assurance process.

The auditor will not simply ask: “do you have ESG targets?”, but rather:

• “how have you defined them?”,
• “what is the base year and reference level?”,
• “how do you measure progress and does it reconcile with financial and operational data?”

Many companies discover at this point that the “targets” which once looked good in a presentation will not pass the assurance test today. They are too general, have no base year, do not stem from materiality or from real data. This is when the nervous adding of new slogans starts – often completely disconnected from what the company actually does.

Meanwhile, the best, most credible ESG targets for the new reporting year are not those invented from scratch, but those that grow out of the company’s existing practice.

Many organisations – perhaps even yours – already operate in line with ESG principles, only… no one has ever called it that and no one has tied it together into a logical set of targets, indicators and policies.

And this is exactly where the real value of the new standards, such as ESRS (European Sustainability Reporting Standards), begins: they allow you to name, organise and steer what often already exists in day-to-day practice. Assurance is therefore not just a form of “control”, but a mirror that very clearly shows whether ESG targets are:

• data-based (rather than wish-based),
• aligned with material topics,
• measurable and time-bound,
• linked to specific KPIs.

That’s why, instead of nervously inventing new targets just to fill the next report, it is worth starting with a simple step: describe what you already do, name it using ESRS language and turn it into well-defined targets that will also stand up in the assurance process.

ESG without the label – what it used to look like

Today, as an ESG manager, I increasingly realise that many of the targets we now report and plan under the ESG label are ones I was already delivering on before – even though nobody called them that at the time.

As a structural engineer, I designed efficient buildings – with the investor’s budget, structural durability and rational use of materials in mind. Because a good structure is one that fulfils its function, is safe and does not generate unnecessary costs.

Later, as an investment coordinator, I managed materials and waste, optimised the use of people, machines and space. All this so that the project would be efficient and profitable – and, as a result, more environmentally efficient.

On one project, I led to the launch of a boiler plant powered by wood residues from production. As a result, the plant not only made use of its waste, but also largely freed itself from external heat supplies, reducing its demand from the grid. Although terms such as “circular economy” or “energy efficiency” were not yet commonly used, I was guided above all by common sense and an economic approach.

This shows that many activities coming from “good economics” today fall under ESG. Because often what is good for the finances is also good for the environment.

Today, these same actions fit perfectly into: resource efficiency (ESRS E5), circular economy, reduction of greenhouse gas emissions (ESRS E1).

ESG targets – what should they really look like?

In everyday practice, many activities that used to aim at optimising costs, materials or energy can today be successfully classified as ESG activities – provided that they are clearly named and measured.

According to ESRS (Metrics and targets – MDR-T), targets must be specific, measurable, realistic and grounded in the company’s business context. They should have an associated KPI and a reference point. In practice: they are simply well-formulated action plans that are worth having anyway – also from a business perspective.

So how could I formulate targets today linked to the activities mentioned above?

Many technical activities that once stemmed simply from the need to save costs now fall within ESG targets. For example, designing efficient structures – assuming lower material usage and better energy performance – can today be described as a resource efficiency target (ESRS E5). Such a target might read: “Reduce material consumption by 15% by the end of 2026 compared to the 2023 base year.” KPIs could include: quantity of materials per m² of floor area (kg/m²), energy use over the building’s life cycle (kWh/m²/year), or share of recycled materials.

Similarly, using wood residues in the boiler plant – a decision originally based on economics – is now an example of circular economy and GHG emissions reduction (ESRS E1 and E5). A possible target: “Reduce boiler plant emissions by 30% by the end of 2026 compared to the 2022 base year.” We measure this, for example, by the share of energy from waste, the tonnes of biomass utilised per year and the calculated reduction of CO₂ emissions (tCO₂e).

Waste management on the construction site – planning orders, segregation, reuse – can now be assigned to a “waste minimisation” target (ESRS E5). A sample target: “Reduce construction waste by 20% by 2025 compared to 2023.” Indicators could be: waste generated per PLN 1 million of investment, recovery and recycling rate, and the number of actions taken to prevent waste generation.

What did the first assurance cycles reveal?

Experience from this year’s assurance engagements has revealed a few recurring issues. Above all, companies often confuse targets with actions – for example, they treat “reducing water consumption” as a target instead of defining by how much and by when this consumption is to be reduced. In many cases there was no reference to a base year, making it difficult to assess progress. It also happened that targets were too general, mismatched to the scale and nature of the company’s activity or completely unrelated to previously identified material topics. This shows that it is worth starting from a well-defined starting point – real data and a concrete diagnosis – before formulating ESG targets that will actually be achievable and documentable.

For many companies, the turning point is… the first inventory

Many companies truly open their eyes only when they have concrete data in front of them. Once energy use, waste volumes or material losses become visible, ESG stops being a side note to the strategy. It becomes a tool for optimisation and for structuring processes. Targets begin to emerge from data, rather than from wishful thinking.

And what if you’re just starting out?

You don’t have to start with grand declarations. Start by answering three simple questions:

What are we already doing well? What can we measure? What is worth improving from a business point of view?

On this basis, you can create your first realistic ESG target – one that not only fulfils the requirement, but also brings value to your company.

Conclusion

Don’t force ESG targets out of thin air. Define what you already do or can start doing – and give it a name, a direction and a measure.

ESG is a way of managing consciously. It is structured common sense. And often also… an economic necessity.

And many companies – quite possibly yours – already have it in their DNA.