Playbook: adopting corporate climate disclosures in 90 days

Executive summary

Over the next few years corporate climate disclosure will become a core requirement for any business operating in Europe. The Corporate Sustainability Reporting Directive (CSRD) expands mandatory reporting to roughly 49 000 companies, up from about 11 700 under the previous Non‑Financial Reporting Directive. In parallel, the EU Battery Regulation requires a digital battery passport (DPP) for every industrial and electric‑vehicle battery placed on the market by August 2027. These passports must include a unique serial number, details of the battery’s composition, carbon footprint and supply‑chain due diligence, and be accessible via a QR code.

The playbook below draws lessons from early adopters such as Volvo Cars—which launched the world’s first battery passport three years ahead of the mandate—and Powin’s partnership with Circulor to issue digital passports for utility‑scale storage systems. It also looks at broader climate‑reporting trends: nearly 99 % of S&P 500 companies now publish sustainability reports, yet a global survey finds that while 92 % of companies assess physical climate risks, only 44 % have adaptation measures and just 17 % disclose financial impacts.

This guide provides a structured 90‑day roadmap to help technical teams comply with these evolving rules, integrate digital product passports into their design process and use climate metrics to drive better products. It highlights what’s working—like early deployment of battery passports and digital MRV tools—and what still needs improvement, such as Scope 3 data quality and supplier engagement. Throughout, we use real‑world examples and quantitative benchmarks to ground the playbook in practice.

Why this matters

Regulatory momentum

EU policymakers are tightening disclosure rules to support the bloc’s decarbonisation and circular‑economy goals. The CSRD dramatically widens the scope of mandatory sustainability reporting, requiring large companies and eventually listed SMEs to publish detailed environmental, social and governance data in their annual reports. By 2026, all large EU companies not previously covered by the NFRD must report, with listed SMEs following in 2027.

At the same time, the EU Battery Regulation introduces a digital product passport for all EV and industrial batteries over 2 kWh. The passport is a digital record containing a unique serial number, manufacturing information, chemical composition, performance and durability statistics, repair instructions and end‑of‑life guidance. Manufacturers must report the battery’s carbon footprint and lifecycle emissions, document the proportion of recycled materials (minimum 12 % cobalt, 85 % lead, 4 % lithium and 4 % nickel by 2030) and conduct supply‑chain due diligence. These requirements, phased in between 2025 and 2036, will reshape how batteries are designed, tracked and reported.

Investor and customer expectations

Outside regulation, market forces are pushing companies to elevate their climate disclosures. 99 % of S&P 500 companies and 94 % of the Russell 1000 now publish sustainability reports. Investors increasingly expect alignment with frameworks like TCFD and CDP, while customers and procurement teams demand transparency about product footprints and sourcing. For battery producers, automotive OEMs and energy‑storage integrators, digital product passports offer a way to meet these expectations by providing granular proof of sourcing, carbon intensity and circularity.

Engineering challenges and opportunities

Engineers play a pivotal role in turning these policies into practice. They must design systems capable of capturing, verifying and reporting vast amounts of data—spanning raw material origins, process energy use, product performance and end‑of‑life management. Digital product passports and corporate climate disclosures share similar data foundations: both require lifecycle carbon footprints, supplier due diligence and product‑specific identifiers. Integrating these requirements into product development and data architectures early reduces future compliance costs and opens new value pools (for example, by enabling battery reuse programmes or qualifying for green financing).

Key concepts and fundamentals

Corporate climate disclosure frameworks

CSRD and ESRS: The Corporate Sustainability Reporting Directive requires companies to report on environmental, social and governance impacts according to the European Sustainability Reporting Standards (ESRS). Companies must conduct a double materiality assessment (considering both impacts and financial implications), set forward‑looking targets, and obtain limited assurance on their disclosures. The scope will expand to around 49 000 companies in the EU.

TCFD/ISSB alignment: Many companies voluntarily follow the Task Force on Climate‑related Financial Disclosures (TCFD) or the newer ISSB standards. The G&A Institute found that 99 % of S&P 500 companies report sustainability metrics, while a Conference Board analysis shows that about 84 % of S&P 500 and 42 % of Russell 3000 companies aligned with TCFD in 2024 (cited in prior research).

Key metrics: According to EY’s Global Climate Action Barometer, 92 % of companies assess physical climate risks but only 44 % have adaptation measures and 17 % disclose the financial impacts of climate change. About 78 % adopt decarbonisation measures across all scopes, yet only 53 % have Scope 3 targets and a mere 8 % report capital allocation to climate action.

Digital product passports for batteries

A digital product passport (DPP) is a structured digital record associated with a physical product. For batteries, it includes:

• Identification: A unique serial number and QR code for each battery.
• Basic characteristics: Production date, battery type, chemical composition and intended use.
• Performance and durability statistics: Updated throughout the battery lifecycle by repair and repurposing actors; must include batch‑specific carbon footprints from February 2025.
• Repair and end‑of‑life information: Guidance for repairers, refurbishers and recyclers, and data on recycled material content.
• Supply‑chain due diligence: Evidence of responsible sourcing and carbon impact at each stage.

The passport will be mandatory for EV and industrial batteries by 18 August 2027, with earlier milestones for carbon footprint declarations (2025), performance classes (2026) and recycled‑content thresholds extending to 2036. Each passport must be accessible to regulators and consumers via a QR code and remain available for at least 15 years.

Carbon intensity and lifecycle metrics

Carbon footprint: Engineers must calculate the cradle‑to‑gate and, where relevant, cradle‑to‑grave emissions of products. For batteries, this includes mining and processing of raw materials (e.g. lithium, cobalt), manufacturing energy use, transport, and end‑of‑life recycling. The battery regulation requires batch‑specific carbon footprints verified by third parties.

Recycled content targets: Batteries placed on the EU market must meet minimum recycled material thresholds (12 % cobalt, 85 % lead, 4 % lithium and 4 % nickel by 2030). Tracking these percentages through the passport is essential.

Carbon intensity of operations: Corporate disclosures should report Scope 1 (direct), Scope 2 (purchased energy) and Scope 3 (supply chain and product use) emissions. For example, Aviva reported a 51 % reduction in Scope 1 and 2 emissions from a 2019 baseline, while acknowledging challenges in supply‑chain data quality.

What’s working

1. Early movers on battery passports

Volvo Cars: In June 2024 Volvo announced the world’s first EV battery passport for its flagship EX90 SUV. The passport records the origin of raw materials, components, recycled content and carbon footprint. It costs about $10 per vehicle and will be gradually rolled out across all Volvo EVs. Engineers developed new tracking methods to trace each component through the manufacturing process and integrated Circulor’s blockchain platform to verify data. This proactive approach positions Volvo to meet the 2027 EU deadline and enhances consumer trust.

Powin & Circulor: Battery‑storage integrator Powin partnered with Circulor to launch digital passports for utility‑scale storage systems. Their passports trace key materials—including graphite, lithium, aluminium, steel and copper—across the supply chain and record embedded carbon emissions. Each Powin battery pack destined for the EU market will carry a QR‑code passport accessible to regulators and customers.

Blockchain pilots: The DigiProd Pass case study highlights Volvo’s use of blockchain to ensure traceability of cobalt and other critical minerals, demonstrating how digital passports can improve accountability and compliance.

2. High levels of sustainability reporting

U.S. companies offer a useful benchmark. The G&A Institute reports that 99 % of S&P 500 companies and 94 % of the Russell 1000 published sustainability reports in 2024. Even the smaller half of the Russell 1000 (companies with roughly US$2–4 billion market cap) reached 90 % reporting after rapid growth in recent years. This widespread adoption shows that disclosure is now a baseline expectation for investors and regulators.

3. Established methodologies and standards

ESRS standards under CSRD provide detailed guidance on data collection, double materiality and assurance requirements. TCFD and ISSB frameworks are already familiar to many companies, easing the transition to mandatory reporting. Tools like the EU Product Environmental Footprint (PEF) and Lifecycle Assessment (LCA) guidelines can help engineers calculate carbon footprints and meet DPP requirements.

4. Digital MRV and traceability platforms

Technologies such as blockchain, IoT sensors and satellite imagery are making it easier to verify supply‑chain data and automate reporting. Circulor and DigiProd Pass provide platforms that integrate data from multiple stakeholders and deliver verifiable digital product passports. These solutions reduce the need for manual data collection and provide continuous updates across the product lifecycle.

What isn’t working

1. Incomplete risk management and adaptation: While most companies assess physical climate risks, fewer than half implement adaptation measures, and only one in six disclose financial impacts. Many disclosures still lack quantitative scenario analysis or detailed risk‑management processes, undermining their usefulness for investors.

2. Scope 3 data gaps: Only 53 % of companies have established Scope 3 targets. Supply‑chain emissions are often the largest component of a battery’s carbon footprint, yet data quality and availability remain weak. Digital product passports can help but require deep supplier engagement and standardised data collection.

3. Complexity and cost: Collecting and verifying data across multiple suppliers and product lifecycles is resource‑intensive. Many SMEs lack the expertise or tools to calculate carbon footprints or implement blockchain‑based passports. The CSRD’s double materiality assessment and assurance requirements add further complexity.

4. Fragmented standards and timelines: Although the ESRS aim to harmonise sustainability reporting, differences persist between EU, UK, U.S. and other jurisdictions. Companies operating globally must navigate multiple frameworks and reporting deadlines (e.g. California’s SB 261, ISSB standards). In battery supply chains, data sharing is hindered by proprietary concerns and inconsistent formats.

5. Limited early adoption of DPPs: Beyond Volvo and a few pilot projects, few battery manufacturers have publicly launched DPPs. With the 2027 deadline approaching, many may struggle to retrofit traceability into existing production lines.

A 90‑day adoption framework for engineers

This phased plan is designed for engineering teams tasked with implementing corporate climate disclosures and digital product passports. It assumes basic familiarity with sustainability reporting but not full compliance.

Phase 1: Map your obligations and readiness (Days 1–30)

1. Identify applicable regulations: Determine whether your company falls under CSRD or national transpositions, and whether your products fall within the EU Battery Regulation scope. Map deadlines for reporting (e.g. 2025 for NFRD entities, 2026 for other large companies, 2027 for SMEs, and 2027 for battery passports).

2. Review existing disclosures: Audit current sustainability reports and ESG data systems. Identify gaps relative to ESRS requirements (double materiality, forward‑looking targets) and DPP data fields (serial numbers, carbon footprints, recycled content, due diligence).

3. Engage stakeholders: Establish a cross‑functional team including engineering, supply chain, finance and legal. Begin discussions with key suppliers about data availability for carbon footprints and material sourcing. Assess whether current ERP and PLM systems can support digital passports.

Phase 2: Gather data and design systems (Days 31–60)

4. Collect baseline data: Calculate Scope 1, 2 and 3 emissions using recognised methodologies (e.g. GHG Protocol). For products, start building lifecycle inventories of materials, energy use and emissions. For batteries, gather batch‑level data on materials, production processes and supplier energy mix.

5. Select a digital passport solution: Evaluate providers such as Circulor, DigiProd Pass or internal solutions. Key criteria include data security, interoperability with ESRS reporting systems, ability to track recycled content and supply‑chain due diligence, and support for blockchain or equivalent immutability features.

6. Define performance metrics and targets: Set science‑aligned targets for Scope 1 and 2 emissions and establish a plan for Scope 3 targets. Align with ESRS and TCFD guidance, and consider joining sector initiatives (e.g. Science Based Targets initiative). For products, decide on carbon intensity metrics (e.g. kg CO₂e per kWh of battery capacity) and circularity targets (e.g. minimum recycled content). Document near‑term and long‑term milestones.

Phase 3: Implement, test and report (Days 61–90)

7. Pilot the DPP: Create digital passports for one product line (e.g. a battery module or EV battery pack). Use real data from suppliers to populate fields such as serial numbers, chemical composition, carbon footprint and durability metrics. Test QR code access and data updates in collaboration with repair and recycling partners.

8. Develop your climate disclosure report: Draft sections covering governance, strategy, risk management, metrics and targets, aligned with ESRS and TCFD. Include physical and transition risk assessments, adaptation measures, capital allocation to climate action, and progress on emissions targets. Use tables and diagrams for clarity, as recommended by the UK’s FRC review of climate reporting.

9. Engage assurance and stakeholders: Engage auditors for limited assurance if required. Share the draft report and digital passport outputs with internal stakeholders and pilot suppliers for feedback. Ensure board oversight and sign‑off.

10. Publish and iterate: Submit the required report within the annual report and register digital passports in the EU electronic system. Plan improvements for the next cycle, expanding coverage to additional products and suppliers and refining data quality.

Fast‑moving segments to watch

1. Battery passport service providers: Companies like Circulor, DigiProd Pass and iPoint offer turnkey solutions to generate and maintain digital passports. Expect consolidation and new entrants as the 2027 deadline approaches.

2. Automotive and energy storage pioneers: Early adopters such as Volvo Cars, Powin, Jaguar Land Rover and Northvolt (through pilot projects) will set industry norms. Monitor new vehicle launches and energy storage systems to see how passport features evolve.

3. Data interoperability standards: Initiatives like the Battery Pass Consortium and the Global Battery Alliance are developing common data models and verification protocols. Aligning with these standards will reduce integration costs.

4. AI and digital MRV: Advances in remote sensing, AI and IoT sensors will automate carbon accounting and risk monitoring. These tools can also feed data into both corporate disclosures and DPPs.

5. Policy expansions: The EU’s Ecodesign for Sustainable Products Regulation (ESPR) will extend digital passports to other product categories (e.g. textiles, electronics, furniture). Future regulations may require passports for batteries in light vehicles, appliances or grid storage devices.

Action checklist

Use this concise checklist to track progress:

• Confirm whether your organisation falls under CSRD and the EU Battery Regulation; map deadlines for both reporting and battery passports.
• Conduct a gap assessment of current disclosures against ESRS and DPP data requirements.
• Create a cross‑functional task force to coordinate data collection and supplier engagement.
• Initiate data gathering for Scope 1–3 emissions and product lifecycle inventories; prioritise high‑impact products like batteries.
• Evaluate and select a digital product passport provider; ensure blockchain or equivalent security features.
• Set science‑aligned targets for Scope 1 and 2 emissions and develop a plan for Scope 3 targets and product carbon intensity.
• Pilot a DPP for one product line and test end‑to‑end data flow; refine based on feedback.
• Draft and review climate disclosure aligned with ESRS/TCFD; include risk assessments, adaptation measures, targets and metrics.
• Arrange for limited assurance and board approval; publish the report and register passports.
• Plan the next iteration: expand passport coverage, improve data quality, deepen supplier partnerships and align with upcoming ESG regulations.

Frequently asked questions (FAQ)

What is the difference between a digital product passport and a corporate climate disclosure?
A digital product passport is a product‑specific data record that travels with the physical item. It includes identifiers, composition, carbon footprint, recycling instructions and supplier due diligence. A corporate climate disclosure is a company‑wide report covering governance, strategy, risk management and metrics (Scope 1–3 emissions, targets, adaptation measures). The passport feeds detailed product data into the broader disclosure.

Why do batteries need passports?
The EU Battery Regulation aims to improve resource efficiency, safety and transparency in the battery value chain. By 2027, every EV and industrial battery sold in the EU must have a digital passport with unique ID, composition, carbon footprint and supply‑chain due diligence. Passports will help regulators enforce recycled‑content thresholds, allow consumers to verify sustainability claims and enable second‑life uses.

We already follow TCFD. Do we still need to comply with CSRD and DPP rules?
Yes. The CSRD and ESRS are mandatory for a much larger set of companies operating in the EU, and they include more detailed double‑materiality assessments, forward‑looking targets and assurance requirements. TCFD alignment will facilitate compliance, but companies must adopt ESRS formats and data requirements. For products like batteries, separate DPP obligations must also be met.

How can we collect supplier data for the passport?
Start by mapping critical materials and suppliers. Use standard questionnaires to request data on origin, carbon footprint and recycled content. Digital traceability platforms can connect to suppliers’ ERP systems and verify data using blockchain or other secure databases. Consider contractual clauses requiring data sharing and collaborate with industry initiatives to reduce duplication.

What happens if we miss the 2027 deadline?
Non‑compliance can result in fines, market access restrictions and reputational damage. Article 69 of the EU Battery Regulation also allows affected parties to claim compensation for harm caused. Early pilots reduce risk and give you time to refine systems before the deadline.

Sources

• European Commission. (2024). EU Battery Regulation: Digital Passport Requirements for Industrial and EV Batteries. Official Journal of the European Union.
• European Commission. (2024). Battery Passport Implementation Timeline: Carbon Footprint, Performance Classes and Recycled Content. Official Journal of the European Union.
• European Commission. (2024). Corporate Sustainability Reporting Directive: Scope Expansion and Reporting Requirements. Official Journal of the European Union.
• Governance & Accountability Institute. (2024). S&P 500 and Russell 1000 Sustainability Reporting Trends. G&A Institute.
• EY. (2024). Global Climate Action Barometer: Physical Risk Assessment and Adaptation Measures. EY.
• Volvo Cars. (2024). World's First EV Battery Passport for EX90 SUV: Materials Traceability and Carbon Footprint. Volvo Cars Press Release.
• Powin & Circulor. (2024). Digital Passports for Utility-Scale Energy Storage Systems. Powin Press Release.
• DigiProd Pass. (2024). Volvo Blockchain-Enabled Battery Passport: Cobalt Traceability Case Study. DigiProd Pass.
• European Commission. (2024). EU Battery Regulation Article 69: Liability Provisions. Official Journal of the European Union.