How to Handle CSRD When Company Structure Changed Mid-Year
Mergers, acquisitions, or restructuring can make CSRD reporting feel like a moving target. When your company’s structure changes mid-year — whether you’ve sold a division, added a new subsidiary, or restructured departments — the question arises: how do you keep your sustainability data accurate and compliant?
The good news is that both the CSRD Directive (EU 2022/2464) and the European Sustainability Reporting Standards (ESRS) allow flexibility for companies that undergo major organisational changes. You just need to document clearly what changed and how it affects your sustainability boundaries and data.
1. Define Your New Reporting Boundary
Under CSRD, your “reporting boundary” must reflect the current consolidation scope of your financial statements. This means that if you buy or sell a business unit during the year, your sustainability report should:
- Include new subsidiaries from the date of acquisition, not retroactively for the whole year.
- Exclude divested entities from the date of disposal.
If you use the VSME Standard, paragraph 14 recommends reporting on a consolidated basis for parent companies, covering all active subsidiaries at the reporting date. Subsidiaries included in the group report are exempted from separate reporting — a key simplification for SMEs.
Tip: Add a simple note in your sustainability report explaining which entities were added or removed and when. Transparency matters more than perfection.
2. Keep Historical Data Intact
Never rewrite your past data to fit the new structure. CSRD and ESRS require comparability, but they allow explanatory notes where structure changes affect trends.
Example:
“Due to the acquisition of GreenTech BV in April 2025, total energy use increased by 18%. Prior-year figures have not been restated.”
That statement is enough to meet disclosure expectations. The goal is clarity, not statistical purity.
3. Align Reporting Dates and Periods
Your sustainability reporting period should match your financial year, even after a structural change. If entities within your group operate on different fiscal calendars, align their data to your group’s year-end — even if this means partial-year estimates.
ESRS allows pro-rata adjustments or simplified estimates for periods shorter than 12 months, provided you explain the approach. Consistent cut-off dates help auditors verify your assurance data.
4. Update Governance and Policies
Restructuring often affects sustainability oversight — new boards, teams, or policy owners. A common reason CSRD reports fail assurance is missing or outdated governance information.
Update these key disclosures:
- Who now oversees sustainability (e.g., new board committees or directors)
- Any updated environmental or social policies
- How risk management responsibilities have changed
Even a short governance update helps maintain compliance with ESRS G1 (Governance, risk management, and internal control).
5. Handle Data Integration Carefully
Merging systems mid-year is challenging. When integrating sustainability data from different entities:
- Document each source system and timeframe
- Flag data that was estimated or converted
- Maintain a clear audit trail (important for limited assurance)
If systems differ — for example, one uses kWh and another uses MWh — standardise units during consolidation and explain conversion methods in your methodology note.
6. Communicate Changes Transparently
CSRD values transparency over precision. If your structure changed, mention it clearly in the “basis for preparation” section of your report. This helps stakeholders and auditors understand why data shifts year-to-year.
Template wording example:
“During 2025, the company completed a merger with EcoSupply Ltd (effective June 30). Data from this entity has been included from July onwards. Comparative data for 2024 reflects the prior structure.”
Simple, factual explanations like this are fully compliant under both CSRD and VSME guidance.
Frequently Asked Questions
What if my company split into two entities during the year?
Each new entity should prepare its own sustainability report covering the part of the year it operated independently. The original entity reports up to the date of separation, ensuring there’s no overlap.
Can I still use the VSME Standard after a merger?
Yes. The VSME Standard allows consolidated reporting for parent companies. Just include the list of subsidiaries in your “basis for preparation” and specify that the report is on a consolidated basis.
How do auditors handle mid-year acquisitions?
Auditors will check that your inclusion dates are consistent with financial consolidation. As long as you document the timing and method clearly, partial-year data is acceptable for limited assurance.
Do I need to restate last year’s sustainability figures?
Only if the change significantly alters comparability (for example, if half your operations were sold). In most cases, a clear explanatory note is sufficient.
Key Terms
- CSRD: Corporate Sustainability Reporting Directive (EU 2022/2464)
- ESRS: European Sustainability Reporting Standards
- VSME: Voluntary Sustainability Reporting Standard for SMEs (EFRAG, 2024)
- Reporting Boundary: Defines which entities and operations are included in the sustainability report
- Limited Assurance: The initial level of external verification required for CSRD reports
Conclusion: Clarity Beats Complexity
When your company structure changes mid-year, don’t panic. You don’t need to redo your entire sustainability report — just document the change clearly and adjust your reporting boundaries going forward.
The CSRD framework was designed to evolve with real businesses. Focus on transparency, consistency, and honest communication, and your report will remain credible — even through change.