Regulation - November 28, 2022
EU to Require Corporate Sustainability Reporting
The Council of the European Union finalized its corporate sustainability reporting directive (CSRD), which will soon require companies to publish detailed information on how their business model affects their sustainability, and on how external sustainability factors (such as climate change or human rights issues) influence their activities.
The new sustainability reporting rules will apply to large public-interest companies in the European Union with more than 500 employees, to all large companies with more than 250 employees and a EUR 40 million turnover, and to all companies listed on regulated markets except micro undertakings. These companies are also responsible for assessing the information applicable to their subsidiaries.
For non-European companies, the requirement to provide a sustainability report applies to all companies generating a net turnover of EUR 150 million in the EU and which have at least one subsidiary or branch in the EU. These companies must provide a report on their environmental, social and governance (ESG) impacts, as defined in this directive.
“The new rules will make more businesses accountable for their impact on society and will guide them towards an economy that benefits people and the environment,” said Jozef Síkela, Minister for Industry and Trade, in a statement. “Data about the environmental and societal footprint would be publicly available to anyone interested in this footprint. At the same time, the new extended requirements are tailored to various company sizes and provide them with sufficient transition period to get ready for the new requirements.”