European Commission’s roadmap on sustainable corporate governance
On 8 October, Accountancy Europe provided its input on the Commission’s roadmap outlining its planning on Sustainable Corporate Governance.
The Commission is expected to come forward with a legislative proposal on supply due diligence beginning of 2021. The Commission will also launch a public consultation before end of the year which will include questions on sustainable corporate governance on a horizontal cross sectoral basis.
European Commission sets up a Platform on Sustainable Finance
On 1 October, the Commission launched the new Platform on Sustainable Finance (full list of members).
The Platform on Sustainable Finance was established as an advisory body to the Commission (as per the EU Taxonomy Regulation requirement).
Members of the Platform will have to:
- advise on the development and usability of the technical screening criteria
- advise on the review of the Taxonomy Regulation
- serve an observatory function – monitor and report regularly to the Commission on EU and MS trends in relation to capital flows towards sustainable investment, advise on policy development (policy coherence from Q4 2021, measures to improve data availability and quality until Q4 2021).
The mandate is two years. The Platform will primarily focus on the technical screening criteria and the EU Taxonomy Regulation and advising on further measures to improve data availability and quality. It is possible that the Platform will also look into, insofar appropriate, how sustainability standards can support the application of the technical screening criteria.
MEPs delve into sustainable corporate governance and due diligence
On 28 September, the European Parliament’s Committee on Legal Affairs discussed the two own-initiative draft reports on sustainable corporate governance and due diligence.
MEP Lara Wolters (Dutch Socialist), in her draft report on corporate due diligence and corporate accountability calls for mandatory due diligence.
MEP Pascal Durand (French Liberal) set out a series of recommendations for revising the NFRD and directors’ duties in his draft own-initiative report for the EP JURI Committee on sustainable corporate governance. Amongst others, the rapporteur considers that the statements should be subject to a mandatory audit.
European Commission presents a plan to increase the EU’s greenhouse gas emission reduction target
On 17 September, the Commission presented an impact assessment plan (communication) to increase the EU’s greenhouse gas emission reductions target for 2030 to at least 50% and towards 55% compared with 1990 levels in a responsible way. To deliver these additional greenhouse gas emissions reductions, the Commission will, by June 2021, review and propose to revise where necessary, all relevant climate-related policy instruments. This will comprise the Emissions Trading System, including as well: possible extension of European emissions trading to new sectors, Member States’ targets to reduce emissions in sectors outside the Emissions Trading System, the regulation on land use, land use change and forestry. The Commission will propose to amend the Climate Law Regulation accordingly.
European Lab Project Task Force on EU Non-financial reporting standards kicks off its work
On 4 September, the EFRAG Lab Steering Group appointed members of the European Lab Task Force on preparatory work for the elaboration of possible EU non-financial reporting standards. Shortly after, the Project Task Force kicked off its work in a first plenary meeting. The work is based on a three-phase approach: 1) assessment 2) proposal 3) outreach.
The Project Task Force is expected to deliver its interim report by end October and a final report by 31 January 2021. Accountancy Europe is being represented at the Project Task Force. Read more
Commission Delegated Regulation on taxonomy-related disclosures
The Commission is working on a number of delegated acts expected to complement the EU Taxonomy Regulation. Over the summer, the Commission issued a roadmap on taxonomy-related disclosures. The roadmap looks into what requirements companies will have to follow in order to publish information on how their activities are associated with the EU taxonomy. Accountancy Europe has submitted its feedback on this roadmap.
The upcoming delegated act will propose methodologies and indicators to help entities determine the extent to which their economic activities can be considered environmentally sustainable according to the EU taxonomy. The delegated act will be adopted by June 2021.