Taxonomy on sustainable finance, duties of company directors, due diligence for companies in supply chains, revision of the non-financial reporting directive, European non-financial reporting standards. 2021 promises to be a busy year in terms of initiatives and legislation on sustainability and corporate responsibility.
At an online conference organised on Monday 15 March by the European Parliament’s working group on corporate responsibility, Justice Commissioner Didier Reynders and Financial Services Commissioner Mairead McGuinness promised to ensure coherence between these different initiatives.
“The aim is to be effective on the ground”, said Didier Reynders, who believes that the various provisions for businesses should above all be simple to apply.
In his view, the revision of the Non-Financial Reporting Directive (NFRD) could set a general obligation, while the proposals on the duties of company directors and due diligence for companies, for which he is responsible, would set the substance.
The Commissioner also welcomed the European Parliament’s strong support for a mandatory EU-wide due diligence for companies along their supply chain with the adoption last week of the own-initiative legislative report (see EUROPE 12675/10) by MEP Lara Wolters (S&D, Netherlands).
The Commission is currently in the process of analysing the results of the public consultation on this subject, for which it has received almost half a million responses. It is expected to make concrete proposals in June.
In particular, the institution is considering how to define high-risk SMEs and whether future rules should apply to third-country companies operating in the EU. It is also examining the establishment of a civil liability and administrative supervision regime, Didier Reynders said.
For her part, Mairead McGuinness also felt that alignment between these different initiatives was essential.
The revision of the NFRD is expected by the end of April and should establish a framework for the development of European standards and will define the information that companies will have to disclose.
The Commission is also considering whether to extend the scope to cover more companies and, again, particular attention would be paid to SMEs, it said.
EU-level audit requirements will also be needed for non-financial reports, it said. (Original version in French by Marion Fontana)