CSRD & ESRS in Malta: What Audit Clients Need to Know
Malta has now implemented the EU’s Corporate Sustainability Reporting Directive (CSRD) through the Corporate Sustainability Reporting Regulations, 2026, introducing mandatory sustainability reporting and assurance for thousands of Maltese companies. For audit clients, this marks a major shift in corporate reporting, governance, and risk management
Who Falls Within Scope?
The CSRD applies in stages:
- 2026 – Large public interest entities with 500+ employees
- 2027 – All other large undertakings
- 2028 – Listed SMEs and certain financial and insurance entities
If your organisation meets the size criteria or is listed on a regulated market, CSRD compliance is no longer optional.
What Audit Clients Must Report
In‑scope entities must prepare sustainability disclosures in line with the European Sustainability Reporting Standards (ESRS), covering:
- Climate and environmental impacts
- Workforce and social matters
- Governance, ethics, and business conduct
These disclosures must be based on a double materiality assessment, which determines what is relevant from both an impact and financial perspective.
Why It Matters for Audit Clients
Sustainability information is now subject to assurance—initially at a limited level, with a move toward reasonable assurance in the future.
This means organizations must ensure:
- Data is complete, accurate, and auditable
- Methodologies (especially double materiality) are robust and well documented
- Internal controls over ESG reporting are designed and operating effectively
- Disclosures are consistent with financial reporting
Common Challenges faced
Many organizations are still building their CSRD capabilities. Key challenges include:
- Fragmented or immature ESG data systems
- Complexity in performing double materiality assessments
- Limited internal controls over non-financial data
- Need for cross-functional coordination (finance, sustainability, HR, risk)
Mandatory Assurance Requirements
For the first time, sustainability information will be subject to independent limited assurance. This means:
- ESG data must be accurate, complete, and traceable
- Internal controls over sustainability reporting must be robust
- Governance structures must support oversight and accountability
Audit committees will play a central role in overseeing the assurance process.
Common Challenges faced
To meet the new requirements, organisations should begin:
- Conducting a double materiality assessment
- Identifying data gaps and strengthening ESG data systems
- Establishing clear roles, responsibilities, and internal controls
- Engaging early with auditors to understand assurance expectations.
Common Challenges faced
We support our audit clients across the full CSRD journey:
- Readiness assessments and gap analyses
- Double materiality methodology and documentation
- Implementation support, including controls and governance
- Pre-assurance reviews (“dry runs”)
The CSRD represents a significant compliance obligation, but it also offers an opportunity to enhance transparency, build trust, and align sustainability performance with long‑term strategy.
Ian Mercieca
Partner
Hailey Cachia Hayman
Audit Manager
Pauline Calleja
Audit Manager
Emeline Bezzina
Audit Assistant Manager
