What is CSRD?
The Corporate Sustainability Reporting Directive (CSRD) is a European Union (EU) regulation aimed at enhancing corporate transparency and accountability in sustainability practices. Since coming into effect on January 5, 2023, CSRD requires companies operating within the EU to disclose detailed information about their environmental, social, and governance (ESG) impacts. This includes reporting not only on how sustainability issues influence their operations but also on how their activities affect people and the planet. Key reporting areas under CSRD include environmental impacts, social and employee-related matters, human rights, and anti-corruption and anti-bribery practices. For businesses addressing CSRD requirements or reporting under other frameworks like the International Sustainability Standards Board (ISSB), within the International Financial Reporting Standards (IFRS), addressing climate-related physical risks is crucial. And to avoid jeopardising the stability of investment portfolios or undermining effective risk management strategies it’s important to utilise high-quality data and advanced climate intelligence to assess the impact of flood on physical assets.
Flood risk
Flooding is one of the most prominent and complex risks linked to climate change. Factors driving this include increased frequency of extreme rainfall events, rising sea levels, changes in snow and ice melt patterns, shifting storm paths, soil saturation and drought cycles and vulnerable ecosystems. These factors, combined with expanding urban development in flood-prone areas, underscore the urgency of addressing flood risk as a critical element of climate adaptation and mitigation strategies.
Recent events such as Storm Babet (October 2023), Storm Boris (September 2024) and the Spanish Floods (October 2024), demonstrate the devastating impact of extreme weather. For example, Storm Boris, fuelled by four-day heavy rainfall, was found to be twice as likely and 20% more intense than in the pre-industrial era, with human activity contributing significantly to these changes (World Weather Attribution, 2024).
As global mean surface temperature rises, surface water flood hazard is projected to increase across most of the globe, largely because a warmer atmosphere holds more moisture, which increases precipitation. Some areas experience decreases in precipitation, and therefore decreases in surface water flood hazard, due to shifts in large-scale weather patterns.
By 2050, JBA’s UK climate change flood model calculates the combined portfolio-level 200-year losses increase by 36% under the medium emissions scenario and by 42% under the high emission scenario. The combined portfolio-level average annual losses increase by 72% and 87%, respectively (JBA, 2025).
The importance of robust flood risk data
For organisations addressing CSRD or broader climate risk frameworks, forward-looking flood risk information is essential. JBA can help with high-quality datasets by providing global climate change flood data for any location. And, using our global flood models we can provide insights into how flood risk might evolve under different future climate scenarios.
Selecting the right data is important. Poor-quality data can distort risk assessments, leading to costly errors, either through underestimating recovery costs or over allocating resources to mitigate overstated risks. Flood risk, often the most significant climate-related physical risk for many regions, demands a robust scientific approach in its assessment. The high-resolution flood risk maps with comprehensive coverage, integrating defence information, natural water flow features, and robust validation processes, will meet the needs of financial risk assessments, enabling institutions to evaluate and compare risks across international portfolios.
Moving forward
The CSRD represents a significant step in embedding sustainability into corporate governance and decision-making. By using credible climate intelligence along with sophisticated flood risk data, organisations can meet regulatory requirements, help safeguard their assets and apply meaningful climate adaptations.