Approval of the Draft Law on Corporate Reporting on Sustainability
On 29 October 2024, the Council of Ministers approved the draft Corporate Sustainability Reporting Law to be submitted to Parliament. The law will oblige large companies and listed small and medium-sized companies (except micro companies) to submit sustainability reports.
The sustainability report includes information on the company's impact on sustainability issues, as well as information necessary to understand how environmental, social, human rights and governance factors affect the performance, results and position of the company or group.
The project establishes a single EU-wide framework, with an electronic format to facilitate comparability. In addition, it regulates independent verification of the reports, similar to financial auditing. Companies will have to comply gradually from 2024, with mandatory dates varying according to size and business characteristics.
From 1 January 2024, the reporting obligation will start for large public interest companies and groups with more than 500 employees. From 1 January 2025, this requirement will be extended to all other large companies. In 2026, it will be the turn of listed SMEs, except for micro-enterprises, and other specific financial institutions. Finally, subsidiaries and branches of third country companies operating in the EU with a turnover of more than 150 million euros will have to comply with these obligations from 1 January 2028. This progressive roll-out is intended to give each type of entity time to adjust to the new transparency and sustainability regulations.
In conclusion, this legislation strengthens transparency and consolidates sustainability reporting obligations, making progress in their harmonisation, traceability and third-party verification, which will result in more uniform, reliable and useful information, according to its explanatory memorandum.
Access to the full informative note
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