Regulatory requirements: CSRD’s supply chain transparency requirements
The EU Corporate Sustainability Reporting Directive (CSRD) comes into force in January 2024, requiring more than 50,000 companies to disclose:
- Full supply chain transparency: traceability from raw materials to end-of-life recycling (Article 19).
- Carbon emissions: reporting on indirect emissions from suppliers and logistics (under the GHG Protocol).
- Dual materiality: disclosing how sustainability risks impact finances – and vice versa.
The risk of non-compliance is a fine of up to €500,000 or 0.1% of global revenue (whichever is higher) and exclusion from public tenders. For example, chemical manufacturers must now disclose the use of PFAS in firefighting foams and the sourcing of cobalt from high-risk regions such as the Democratic Republic of Congo.
Manual reporting does not meet the granularity of the CSRD: A 2023 EY survey found that 74% of companies lack digital systems to track Tier 3 supplier data.
Technology Integration: NFC DPP Automates ESG Reporting
The NFC-enabled Санарип продукт паспорту (DPP) closes the CSRD gap by:
A.Automating Carbon Emissions Data Collection
Each Nfc Tag stores an encrypted supply chain record:
- Supplier provenance data: Carbon footprint from raw material extraction (e.g., bauxite mining).
- Logistics log: Verification of shipping emissions via the GLEC framework.
- Proof of recycling: Post-consumer recycling rates from EPR systems.
Example: Scanning an Nfc Tag on a chemical drum automatically populates SAP Sustainability Footprint Management:
- Carbon emissions: 12.3 kg CO2e/kg.
- Conflict Minerals Compliance: Cobalt sourced from Glencore’s Copper Mine.
B.Enable Real-Time Auditing
- Blockchain Anchoring: Siemens’ DPP Suite stores NFC data hashes on Hyperledger Fabric, meeting CSRD audit trail requirements (Article 29).
- Dynamic Updates: Instantly modify ESG disclosures when switching to renewable energy suppliers.
Case Study: BASF leverages NFC DPP to improve ESG rating to AAA
Company: BASF SE (world’s largest chemical producer)
Challenge: CSRD compliance for 45,000+ products with fragmented supplier data.
Solution:
- Deployed NXP NTAG 424 DNA tags on 10+ million chemical containers.
- Integrated with SAP Green Token for real-time carbon emissions tracking.
Result:
- AAA MSCI ESG rating (A in 2022).
- Reduced CSRD preparation time by 40% by automating NFC data flows.
- €2.8 million in third-party audit cost savings (BASF Annual Report 2023).
(Source: BASF Annual Report 2023, p. 117)
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