Since 2015, the United Nations Sustainable Development Goals (SDGs) have been a global reference for aligning corporate strategies with social, environmental, and economic priorities. However, for years, their implementation within companies remained largely voluntary and was often linked to generic, hard-to-measure commitments.
With the entry into force of the CSRD (Corporate Sustainability Reporting Directive) and the CSDDD (Corporate Sustainability Due Diligence Directive), symbolic commitments have evolved into measurable and verifiable obligations. Europe now requires companies to demonstrate, through standardised and verifiable data, the impact they generate—including how they contribute, or fail to contribute, to the Sustainable Development Goals.
What is the CSRD and how does it intersect with the SDGs
The CSRD (Corporate Sustainability Reporting Directive) is the new European directive that sets out mandatory sustainability reporting rules for companies. It replaces and expands the former NFRD (Non-Financial Reporting Directive), bringing greater rigour, comparability, and scope to non-financial reporting.
For the first time, this reporting must be standardised and auditable, based on the ESRS (European Sustainability Reporting Standards)—a set of technical standards that define what must be reported, how it should be presented, and the required level of detail. This approach raises sustainability reporting to the same level of scrutiny as financial reporting, enabling more consistent, transparent analysis aligned with the expectations of regulators, investors, and other stakeholders.
Under the CSRD, companies are now required to disclose:
- Significant impacts in environmental, social, and governance areas
- Sustainability-related risks and opportunities
- Detailed information on policies, targets, performance, and action plans
Although direct reference to the SDGs is not mandatory, many of the topics covered by the CSRD are closely aligned with the goals set out by the United Nations. For example:
- Reporting on emissions, climate adaptation, and energy relates to SDG 13 (Climate Action)
- Issues around diversity, equality, and labour conditions are linked to SDG 5 (Gender Equality) and SDG 8 (Decent Work)
- Topics such as business conduct and value chains are connected to SDG 12 (Responsible Consumption) and SDG 16 (Peace, Justice and Strong Institutions)
Many companies—including Castro Group—choose to map relevant SDGs within the CSRD framework, offering a clearer, internationally aligned interpretation that supports external stakeholders (partners, investors, communities, public entities).
CSDDD – Acting responsibly
The CSDDD (Corporate Sustainability Due Diligence Directive) is another key component of the EU’s new corporate sustainability legislation. While the CSRD requires companies to report impacts using standardised frameworks, the CSDDD requires them to act on those impacts based on due diligence principles. In other words, one focuses on information transparency, and the other focuses on practical and legal responsibility. These directives are complementary: CSRD asks “what do you measure and how do you communicate it?”, while CSDDD demands “what do you do and how do you prevent harm?”
Put simply, the CSDDD requires companies to identify, prevent, mitigate, and, when necessary, remedy severe negative impacts on human rights and the environment across their entire chain of activities—including direct and indirect suppliers.
The obligations include:
- Mapping and assessing actual or potential adverse risks and impacts
- Implementing measures to prevent or mitigate those impacts
- Establishing remediation and grievance mechanisms
- Monitoring performance over time
- Keeping robust, verifiable documentation of processes
CSDDD is not about communication—it’s about conduct. And the SDGs offer a strong foundation for acting with responsibility, consistency, and global vision. Many of the risks the CSDDD requires companies to address are directly related to the Sustainable Development Goals, such as:
- SDG 8 – Decent work and economic growth
- SDG 5 – Gender equality
- SDG 12 – Responsible consumption and production
- SDG 13 – Climate action
- SDG 16 – Peace, justice and strong institutions
By using the SDGs as a reference point in due diligence processes, companies can:
- Communicate their actions and commitments more effectively
- Prioritise risks and impacts based on globally recognised criteria
- Align with other international frameworks, such as the UN Guiding Principles on Business and Human Rights or the OECD Guidelines for Multinational Enterprises.
The VSME and the new role of suppliers in the value chain
To ensure a fair and practical transition, the EU is developing the VSME (Voluntary Sustainability Reporting Standard for SMEs)—a simplified framework designed for small and medium-sized enterprises that are part of the value chains of large companies subject to the CSRD.
Large companies will be required to obtain reliable and standardised sustainability information from their suppliers, and the VSME provides a structured yet proportionate way to respond to that demand.
The VSME will be voluntary but strongly recommended, especially for:
- SMEs working with multinationals or listed groups
- Startups and scaleups seeking to attract ESG investment
- Companies aiming to demonstrate best practices, even without a legal obligation
By adopting the VSME, SMEs gain easier access to more demanding value chains and strengthen their credibility with partners who prioritise sustainability as a key selection criterion.
Integrating the Sustainable Development Goals (SDGs) into sustainability reporting is no longer a symbolic gesture. Today, it is a strategic tool—essential for demonstrating real impact, anticipating risks, strengthening stakeholder trust, and aligning business practices with current social, environmental, and regulatory demands.
The entry into force of the CSRD and the CSDDD marks a new stage in this evolution: coherence is now required between what companies say, what they do, and the outcomes they deliver. And the SDGs provide a common, global language to give structure and scale to that coherence.
At Castro Group, this vision has always been part of our operations. We committed to the SDGs before any legal obligation existed because we believe real estate projects must generate measurable positive impact—aligned with the world’s major challenges. Our annual Sustainability Report reflects this commitment: it translates values into indicators, goals into results, and actions into tangible transformation in our territories.
As the sector adapts to new demands, we reaffirm sustainability as a strategic, transversal, structural, and shared decision. Building the future is more than constructing buildings—it is about creating lasting value with awareness, transparency, and collective purpose.
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