Sustainability reporting gathers support across Europe

The European Commission has announced plans for new, mandatory sustainability reporting.

Announced on 21 April 2021, the Sustainability Reporting Directive would overhaul the 2014 Non-financial Reporting Directive, which requires businesses across Europe to disclose on environmental and social issues.

The new system will allow greater clarity on a businesses impact on both the environment and society. The Directive will look at past data but will also include sustainability strategies and targets for the future, allowing much greater transparency for government bodies and other stakeholders.

Today, only France, Spain and Italy require independent and compulsory checks on non-financial information, but following the European Parliament’s work on Sustainable Corporate Governance and strong support shown from MEPs and a public consultation, this new directive will allow talks to develop for establishing a common framework for additional reporting.

The proposed Corporate Sustainability Reporting Directive would require large EU companies, and those listed on an EU-regulated exchange, to use the same set of standards to report on environmental, social and governance matters every year.

Within the UK, greater clarity on non-financial reporting is expected in coming years, with a range of updated legislation under the Resources and Waste Strategy. Data reporting will become increasingly more demanding for businesses, with the Plastic Packaging Tax, Extended Producer Responsibility (EPR) and the introduction of a Deposit Return Scheme (DRS).

Sam Caplen, Account Manager at Clarity Environmental, highlighted that sustainability is becoming a driving factor for many businesses and data reporting is an essential component of this.

“Studies have shown that good sustainability and environmental, social and governance practices correlate with lower operating costs, better profitability and superior share price performance. As we focus more on these factors, both ethically and to comply with changing environmental legislation, data reporting and supply chain transparency will be essential to meet targets and drive growth.

“Businesses in the UK will potentially have to begin reporting packaging data quarterly for both Plastic Packaging Tax and EPR, which provides an excellent opportunity to streamline sustainability targets and look at reporting methods which will future-proof their business from the coming changes.”

Is your business data ready?

Extended Producer Responsibility, The Plastic Packaging Tax and Deposit Return Scheme will place stringent reporting requirements on producers of packaging, requiring additional data. Failing to prepare for these changes now could see the cost of compliance with the packaging regulations increase dramatically. Contact a member of our team to find out how we can guide you through the changes.

Find out More