Modernization of the Content of the Management Report in the Process of Implementing Sustainability Reporting

Abstract

The paper examines the current state, challenges, and directions for modernizing the content of the management report in Ukraine in the context of introducing sustainability reporting in accordance with CSRD and the ESRS. Based on a comparative analysis of the provisions of the Methodological Recommendations for preparing a management report and Directive 2013/34/EU, a number of substantive and structural discrepancies have been identified that reduce the in formativeness of domestic reports and their alignment with European experience. It is established that domestic practice is characterized by a predominantly formal approach to report preparation, duplication of financial statement data, lack of adequate disclosure of the business model, key intangible resources, the structure of expenditures on research and innovation activities, and forecasts of their impact on performance, as well as insufficient description of risks and development prospects. Directions for improving the national Methodological Recommendations are proposed, including detailing requirements for disclosing strategic goals, key performance indicators, the business model, and value creation mechanisms, avoiding duplication of financial statement information, and integrating quantitative assessments of risks and forecast indicators. Implementation of the proposed changes will enhance the transparency, relevance, and comparability of the management report and strengthen stakeholder trust, ensuring the compatibility of the Ukrainian non-financial reporting system with European requirements. The prospects for further research are outlined, focusing on a deeper analysis of integrating the provisions of CSRD into the national regulatory framework, in particular refining the Methodological Recommendations to ensure the structural and content alignment of management reports with EU legislation, developing an optimal set of financial and non-financial key performance indicators for various economic sectors, and studying tools for increasing the long-term value of enterprises.