We are happy to announce our investment in Sustashift, a Finnish startup transforming CSRD reporting with a scalable, automated software solution, reducing the 500-hour manual tagging process to 5 seconds. Leading their funding round, joined by Wave Ventures, we are happy to contribute to Sustashift’s mission to provide the best software solution for CSRD reporting across Europe.
“Having a tech solution for reporting, and automating time-consuming tasks such as tagging, enables corporates to focus their own valuable time to actions and improvements on sustainability – not just reporting. As company foundations are built by lawyers, customers can rely on the CRSD solution to truly meet the complex regulatory requirements. These are the reasons why we believe Sustashift has a unique position in the market,” says Terhi Vapola, Founder & Managing Partner at Greencode Ventures.
Sustashift, founded in 2023 and headquartered in Finland, provides solutions that enable companies to navigate the complex reporting requirements, providing structured ESG reporting that complies with the European Sustainability Reporting Standards (ESRS) mandated by the CSRD. The directive’s double materiality perspective requires companies to disclose both the impact of their business on sustainability and how sustainability issues affect their financial performance.
By assisting companies in fulfilling these requirements, Sustashift helps them reduce reporting costs, enhance investor trust, and improve their reputation through transparent and consistent sustainability practices by providing one of the most advanced tagging solutions in the market.
In 2021, the European Commission introduced the Corporate Sustainability Reporting Directive (CSRD) to enhance transparency in corporate sustainability reporting. The CSRD amends the Non-Financial Reporting Directive (NFRD), significantly expanding the number of companies required to disclose environmental and social impacts, covering around 50,000 firms, including listed SMEs. The directive ensures that investors and stakeholders have access to critical sustainability data, with mandatory assurance and digital taxonomy for standardized reporting.
The implementation of the CSRD is driving substantial growth in the ESG software and reporting services market, as companies seek compliance with the expanded disclosure requirements. The directive applies not only to EU companies but also to non-EU firms generating over €150 million in turnover in the region by 2028. This marks a significant increase from the 11,000 companies previously covered under the NFRD. With additional requirements for listed SMEs, simple credit institutions, and captive insurance firms, the first reports are expected by 2026, with an opt-out available until 2028. The growing regulatory focus on sustainability reporting is expected to reshape corporate accountability and investor decision-making across Europe.
Complying with the CSRD is a resource-intensive process, with manual tagging and compliance taking up hundreds of hours per report. This has created a demand for automated solutions to streamline reporting. Sustashift addresses this challenge with a software solution that eliminates manual work, ensures full regulatory compliance, and enhances the efficiency and accessibility of sustainability reporting for businesses. Its automatic tagging feature sets it apart from other solutions.
At Greencode, we believe that strong teams can build world-class products making real impact. With a deep understanding of regulatory requirements and cutting-edge technology, Sustashift’s team has demonstrated a strong ability to execute quickly and scale effectively, delivering substantial value to its growing customer base. Since Sustashift’s foundations are built by legal experts, customers trust that Sustashift’s CSRD solution is fully aligned with complex regulatory requirements.
Sustashift is solving a pressing problem at scale, helping both listed and non-listed companies across industries redirect their time and resources from compliance tasks to actual sustainability improvements.
At Greencode Ventures, we invest in companies that are driving the green transition through scalable digital solutions. Sustashift is a perfect fit for our investment thesis, and we are excited to support them as they scale to transform CSRD reporting across Europe.
We are here to invest in and support startups making a difference. Get in touch: hello@greencode.vc