The EU and UK governments are both keen on green issues and climate change in particular. What does mean for insurers, MGAs and brokers? Well certain carbon related business clients (oil, gas, mining etc) will eventually have to insure outside of the EU bloc most likely, but it also means that every company will have to spend more time compiling ESG data into all annual accounts and corporate filings. Here is a policy heads-up for you;
GRI has welcomed that the European Commission is maintaining its ambition to achieve progress in corporate transparency on sustainability impacts, following publication of the proposed new Corporate Sustainability Reporting Directive (CSRD).
The CSRD would have a significantly extended scope than the current Non-Financial Reporting Directive, applying to all large or listed companies operating in the EU. With a stated aim of bringing sustainability reporting on a par with financial reporting, it would help ensure both have equal weight and rigor.
Since its inception more than 20 years ago, GRI has championed the move to mandatory sustainability reporting requirements, while freely providing the sustainability standards that are widely and increasingly used by organizations on a voluntary basis.
Notable components of the CSRD include:
- New EU sustainability reporting standards will be developed through a multi-stakeholder and transparent process led by EFRAG, taking account of the GRI Standards and other existing reporting frameworks
- Explicit adoption of ‘double materiality’ – requiring public reporting on both sustainability factors affecting the company (financial materiality) and how the company impacts on society and the environment (outward materiality)
- Reporting will be mandatory, with sustainability and financial information given ‘comparable status’, and a requirement for reported information to be audited and assured
Peter Paul van de Wijs, GRI Chief External Affairs Officer, said:
“We are greatly encouraged that the European Commission is pressing ahead, at pace, with plans to significantly strengthen sustainability reporting in the EU. This legislation would introduce mandatory requirements for some 50,000 companies to disclose the full range of their impacts on people and planet, which is essential if the EU is to ensure meaningful progress in achieving the Green Deal.
The CSRD – which embraces multi-stakeholder, impact-focused reporting, positioning sustainability and financial reporting on an equal footing – closely aligns with the approach and scope of the GRI Standards, which are already voluntarily used by most large companies in Europe.
We look forward to working closely with EFRAG to co-design a sustainability reporting systemthat reflects the Commission’s ambitions for consistent and comparable reporting on corporate impacts, contributing to the next steps in the continued evolution of corporate reporting.”