In an open letter calling on regulators to align pending European sustainability reporting standards with worldwide consistent and comparable performance metrics and disclosures, 56 organizations, representing over EUR 8.5 trillion in assets and employing over 5 million people have addressed the European Union’s institutions today.
Addressed to the European Commission, the European Parliament and the Council of the European Union, the letter comes as a result of the European Union’s announcement earlier this year on a proposed Corporate Sustainability Reporting Directive. The proposed directive would mean a four-fold rise in European regulatory coverage from 11,700 companies as of now to more than 49,000 with additional, detailed reporting requirements in both environmental and social disclosures.
These regulatory developments go alongside efforts at a global-level from the International Financial Reporting Standards (IFRS) Foundation to create an International Sustainability Standards Board, which will develop globally accepted standards for sustainability reporting.
Global organisations like the IFRS Foundation and the International Organization of Securities Commissions recommend taking a ‘building block approach’ to implement a foundation of globally-consistent sustainability standards regulators both nationally and regionally to supplement it with additional standards specifically tailored to jurisdictional needs. The open letter released today supports this approach and asks for constructive talks moving forward between both the EU and international bodies.
The proposals outlined in the letter clearly depict the priorities behind groups like WBCSD’s CFO Network in readying itself to deliver on stronger commitments to corporate sustainability and disclosure. Executives in leading companies are working alongside key regulators to ensure the financial system adequately rewards sustainable business. Ensuring ESG standards are both universal and comparable worldwide, it is a fundamental step in this movement, leveling the playing field for all companies regardless of jurisdiction or geography.
The European Roundtable of Industry, the Value Balancing Alliance, the World Business Council for Sustainable Development and the World Economic Forum have all backed this open letter.
Read the open letter here.
Source: Sustainability Reports