Sustainable Finance

January 2021

  • Portugal takes over the rotating presidency of the Council of the European Union
  • Commission postpones the publication of the EU Taxonomy delegated acts
  • EFRAG European Lab Project Task Force on non-financial reporting standards presents their preliminary views

Accountancy Europe responded to the IFRS Foundation consultation paper on sustainability reporting

Accountancy Europe welcomed the IFRS Foundation’s proposal in their consultation paper on sustainability reporting and consider it as a necessary step towards global non-financial information (NFI) reporting standards. Some additional suggestions include:

  • setting out a clear vision for interconnected standard setting for corporate reporting
  • working towards a conceptual framework for interconnected standard setting
  • developing an approach to materiality
  • collaborating with global and European stakeholders
  • building upon the work of existing NFI initiatives.

Read more

EFRAG PTF NFRS published an outreach document on preparatory work on EU non-financial reporting standards

EFRAG’s Project Task Force on Non-Financial Reporting Standards (PTF NFRS) published an outreach document with their preliminary views emerging from the ongoing preparatory work on the possible elaboration for EU non-financial reporting standards. The document was discussed in a series of outreach webinars.

Accountancy Europe co-hosted two of the seven outreach events, specifically the ‘European organisations and other European countries focused’ outreach and the ‘Financial institutions focus’ outreach. We also submitted a letter to the EFRAG’s PTF NFRS on their recent proposals.

Priorities of the Portuguese Presidency of the Council of the European Union

On 1 January, Portugal took over the rotating Presidency of the Council of the European Union until the 31 June. The three main priorities will be:

  • the promotion of Europe’s recovery, leveraged by the climate and digital transition
  • the implementation of the Social Pillar as a key element for ensuring a fair and inclusive climate and digital transition
  • the strengthening of Europe’s autonomy by keeping it open to the world. Read more

EFRAG’s European Lab: provide your views on non-financial risks and opportunities reporting practices

EFRAG’s European Lab Project Task Force on Reporting of Non-Financial Risks and Opportunities issued a survey to identify good reporting practices of sustainability-related risks and opportunities and how these can develop and sustain a company’s business models. Read more

Commission consults on the establishment of a single access point for financial and non-financial information

The Commission seeks general and technical views on ways to establish a European single access point for companies’ financial and sustainable investment-related information. Such an EU-wide platform should provide investors with seamless access to financial and sustainability-related company information. Stakeholders can contribute until 3 March. Read more

Commission postpones publication of the EU Taxonomy delegated acts

The Commission delayed the publication of EU Taxonomy delegated acts on climate change mitigation and adaptation. Two main reasons stated were: i) high number of responses received ii) some Member States expressed concerns that gas cannot be used as a transition fuel. (Read full article) The Commission also asked the Platform on Sustainable Finance for advice on how the EU Taxonomy is enabling the financing of the transition to a sustainable economy. The Platform’s input is expected to further inform the finalisation of the delegated acts and the renewed Sustainable Finance Strategy. Read more

Council agrees on a general approach to Climate Law

The Council’s agreement includes a new EU greenhouse gas emissions reduction target of 55% by 2030 compared to 1990. This completed the partial negotiating position agreed by the Council in October 2020 and provided the Presidency with a mandate for further negotiations with the European Parliament (EP) on the Commission proposal. Before the regulation can be adopted, the Council and the EP need to reach a compromise agreement on the proposal. Read more

European Parliament’s position on sustainable corporate governance

MEPs approved a non-legislative report on sustainable corporate governance prepared by Pascal Durand (Renew Europe, France). They welcome the Commission’s commitment to reviewing the Non- Financial Reporting Directive (NFRD) and reiterate their call to widen its scope to cover all listed and non-listed large undertakings. The EP calls for a mandatory EU framework to cover a full array of sustainability issues related to non-financial reporting. Non-financial statements should also be subject to a mandatory audit. MEPs also call on the Commission to present a legislative proposal to ensure that directors’ duties include the long-term interest of the company and wider societal interests. Read more

CDP-CDSB-GRI-IIRC-SASB’s prototype climate-related financial disclosure standard

CDP, CDSB, GRI, IIRC, SASB published a paper on enterprise value reporting, illustrated with a prototype climate-related financial disclosure standard. These organisations have mapped how their initiatives, along with the TCFD recommendations, can be used in reporting value creation and erosion. Read more

IASB’s Chair keynote speech

The IASB Chair, Hans Hoogervorst, delivered a keynote speech in a virtual conference addressing sustainability, organised by the Japanese Institute of Certified Public Accountants. He touched upon the projects in this area, including the Exposure Draft for the Management Commentary (expected in spring 2021), the educational materials on climate change and the IFRS Foundation consultation paper on sustainability. Read more

The IIRC revised <IR> Framework to enable enhanced reporting

The International Integrated Reporting Council (IIRC) published the first revision of the Integrated Reporting <IR> Framework since its inception. Based on the extensive stakeholders’ feedback (read Accountancy Europe response), the IIRC took the opportunity to clarify concepts, simplify guidance for report preparers and underpin better quality integrated reports. Read more This curated content was brought to you by Vita Ramanauskaité, Accountancy Europe senior policy advisor since 2015. You can send her tips by email, follow her on Twitter and connect with her on LinkedIn.