CSRD Business Conduct (ESRS G1)

The six ESRS G1 disclosure requirements

G1-1 Business conduct policies and corporate culture: Anti-corruption and anti-bribery policies; code of conduct; corporate culture initiatives; zero-tolerance statement with board sign-off; and how the policy is communicated to employees and business partners.

G1-2 Management of relationships with suppliers: Payment terms policy; fair dealing commitments; how sustainability is integrated into supplier selection and management.

G1-3 Prevention and detection of corruption and bribery: Anti-corruption training coverage (percentage of employees trained); due diligence on corruption risk for new business relationships (agents, distributors, JV partners in high-risk countries); and internal controls for corruption prevention.

G1-4 Incidents of corruption and bribery: Total confirmed incidents during the reporting period; status of each incident (under investigation, remediation in progress, resolved); any convictions or regulatory sanctions.

G1-5 Political influence and lobbying: Total political contributions by country; lobbying expenditure; material trade association memberships and alignment of their lobbying positions with company sustainability commitments.

G1-6 Payment practices: Average days to pay supplier invoices; percentage of invoices paid within agreed terms; compliance with national late payment legislation.

Anti-corruption training — the most verified G1 metric

G1-3 anti-corruption training coverage is consistently the most scrutinised G1 metric in assurance reviews. Assurers request LMS (Learning Management System) records to verify the disclosed percentage.

Defining the training scope: Which employees must complete anti-corruption training? Best practice covers all employees in roles with external financial authority (procurement, sales, finance, M&A, government affairs) as highest priority; all management-level employees; and all employees in operations in high-corruption-risk countries (CPI score below 50). Not every employee necessarily requires training — but the scope must be defined, documented, and consistently applied.

Training quality: Click-through e-learning with no knowledge assessment satisfies the letter of G1-3 but not its spirit. Assurers increasingly test whether training includes a knowledge check with a minimum pass mark. Training that includes realistic scenarios and local language delivery for high-risk country employees provides stronger evidence of genuine anti-corruption culture.

New joiner training: Disclose whether new employees complete anti-corruption training within their induction period. Mandatory induction training with a defined completion deadline (typically 30–90 days from start date) provides a credible control environment.

Refresher cycle: Annual or biennial refresher training for all in-scope employees — with completion tracking — is the assurance-ready standard. A company that trained all employees three years ago but has no refresher programme does not have current coverage.

G1-6 payment practices — the supplier protection disclosure

G1-6 emerged from EU policy concern about large companies using extended payment terms as a working capital management tool at the expense of SME suppliers. ESRS makes this practice transparent.

Metrics required: Average days to pay supplier invoices — calculated from invoice date (or receipt date where tracked) to payment date. Percentage of invoices paid within agreed terms. Whether payment practices comply with national late payment legislation (EU Late Payment Directive and national equivalents).

Data source: Accounts payable systems — most ERP platforms (SAP, Oracle, Microsoft Dynamics) can produce payment term compliance reports. For multinational companies, consolidate across all AP entities and currencies. Convert to a single average figure for disclosure.

For companies with poor payment practices: the G1-6 disclosure creates accountability. Large companies that routinely pay SME suppliers 90+ days late will face investor and NGO scrutiny when this is disclosed. Use the disclosure requirement as an internal trigger to review and improve payment terms — the reputational cost of public disclosure outweighs the working capital benefit of delayed payment.

EU Late Payment Regulation update: The EU is reviewing the Late Payment Directive — proposed changes would cap standard payment terms at 30 days for commercial transactions. Monitor legislative progress as this will affect what G1-6 compliance looks like from 2026 onwards.

Frequently asked questions