Multinational chemicals producer and Enablon customer BASF needed to comply with the Corporate Sustainability Reporting Directive (CSRD), which requires companies operating in the European Union to submit annual management reports that detail impacts on sustainability matters, and how these affect the company's development, performance, and position.
BASF's call for urgency on CSRD
The CSRD requires reporting companies to state whether their data's compliance with sustainability reporting standards is assured by a third party.
As one of the world's largest chemical companies dedicated to environmental protection and social responsibility, BASF wanted to obtain reasonable assurance of its sustainability reporting and data quality to show their commitment to accountability, build stakeholder trust, lead by example, and strengthen risk management.
Before 2018, BASF reported sustainability in accordance with Global Reporting Initiative (GRI) indicators, which was comprehensive disclosure with limited assurance. Since 2018, BASF has continued to report in accordance with GRI indicators and has added operational GHG emissions (Scope 1 and Scope 2) as steering indicators with reasonable assurance.
The road to reasonable assurance
BASF's road to reasonable assurance began by expanding its existing EHS reporting requirement to include a duty to report in a “true and fair” manner, meaning their reports are verified by an independent auditor as compliant with the European Sustainability Reporting Standards and is a true and fair account of their ESG performance. The company created an internal standard for the monitoring of greenhouse gases with more stringent methodologies for estimation, calculation, and measurement, and with internal control mechanisms installed at the site level. BASF started integrating greenhouse gas monitoring and reporting into its financial compliance process and labeled the Enablon Metrics module as an IT process relevant to the Financial Reporting Council.
BASF focused on improving its process of data collection and internal controls. In 2024, data collection shifted from the site level to the plant level, which was supported with automatic data collection and quality control in the Enablon Air Quality module. This builds a transactional system in the Metrics module that moves from plant data collection to site aggregation to group consolidation.
BASF plants that emit the greatest volumes of greenhouse gases have shifted to a more frequent cycle of reporting, which means time periods for data collection are shorter. This coupled with the fact that data collection now occurs at plant rather than site level mean BASF now has more detailed and timelier greenhouse gas emissions data. Additionally, Enablon software dashboarding tools provide BASF better visualization of intra-site allocation of indirect emissions.
In BASF's previous process, local data collection and site aggregation was followed by local validation and global validation before being externally reported. With reasonable assurance being the goal, the global validation process now has two parts: a unit-to-site aggregation and a site-to-group aggregation. Using Enablon's cloud-based software, BASF has a built-in audit trail, and plausibility checks on indicator levels and can convert time series data to metrics.
The results of reasonable assurance
Business results have included higher granularity and greater detail of data generated from BASF sites and plants, and higher transparency of greenhouse gas emissions and efficiency in data gathering, which has enabled greater reporting frequencies. With improved data detail, transparency, and efficiency, BASF intends to increase the frequency of reporting to a monthly basis.
In summary, BASF's reworking of its data standards and internal controls with the help of Enablon's digital tools has resulted in better data collection, increased data volume, better data analysis, and more efficient reporting – all important steps on the road to reasonable assurance.
To learn more about the Enablon Metrics module and how it can help you gather transparent and better-quality data that meets CSRD standards, contact Enablon today.
