Sustainability Reporting in Procurement Law 2026

Definition: Sustainability reporting refers to the structured disclosure of information on environmental, social and governance (ESG) aspects of a company; in procurement law it is gaining importance as a suitability and evaluation criterion, particularly as a result of the EU Corporate Sustainability Reporting Directive (CSRD).

Last updated: January 2026 · Legal basis: CSRD (Directive 2022/2464/EU), ESRS, Directive 2014/24/EU, BVergG 2018

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What is sustainability reporting?

Sustainability reporting is the systematic documentation and publication of information about how a company handles environmental, social and governance risks (ESG) and what impact its activities have on society and the environment. With the Corporate Sustainability Reporting Directive (CSRD, Directive 2022/2464/EU), the EU has substantially extended the obligation to report on sustainability: from 2025 (for the 2024 financial year), large capital-market-oriented companies are first required to report; the obligation is being extended gradually to further groups of companies.

Relevance for procurement law

In procurement law, sustainability reporting initially has an indirect effect: contracting authorities can require bidders to provide evidence of their environmental and social standards, which can often be drawn from sustainability reports. In addition, published sustainability reports can serve as a basis for evaluating award criteria, for example when assessing a company's CO₂ balance or its supply-chain transparency.

In the medium term, sustainability reports prepared to the CSRD standard can be expected to serve as robust sources of evidence for ESG suitability requirements in procurement practice as well.

CSRD and European Sustainability Reporting Standards (ESRS)

The CSRD requires affected companies to report in accordance with the European Sustainability Reporting Standards (ESRS), which were developed by the European Financial Reporting Advisory Group (EFRAG). The ESRS cover topics such as climate change, biodiversity, working conditions, human rights and corporate governance. The reports must be published in the management report of the annual financial statements and confirmed by an accredited auditor or certifier.

Use in tender procedures

Public contracting authorities can recognise sustainability reports as evidence of technical and professional capacity or of compliance with performance conditions. Concretely, this can mean:

• Submission of a sustainability report as evidence of an environmental management system
• Use of ESG key figures as the basis for award criteria (e.g. Scope 1 and Scope 2 emissions)
• Evidence of compliance with supply-chain due diligence duties (relevant in the context of the German LkSG and the EU Corporate Sustainability Due Diligence Directive, CSDDD)

FAQ

Must all bidders submit a sustainability report? No. The reporting obligation under CSRD applies only to certain companies. However, contracting authorities may require sustainability information to be submitted as a voluntary suitability or evaluation criterion, provided this is proportionate.

When does the CSRD reporting obligation apply to SMEs? Listed SMEs are expected to become subject to the reporting obligation from financial year 2026; non-listed SMEs are in principle not directly subject to reporting, but may be indirectly captured through supply-chain duties.

Can a contracting authority base the exclusion of a bidder on the absence of sustainability reporting? Only if the submission of a sustainability report was clearly and proportionately defined as a mandatory suitability requirement in the tender documents in advance.

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Last updated: January 2026 All information without guarantee. For legally binding advice, please contact a law firm specialising in procurement law.