The CNMV and the ICAC issue a statement pending transposition of the CSRD into Spanish law
Directive (EU) 2022/2464 on Corporate Sustainability Reporting (CSRD) should have been transposed into Spanish law before 6 July 2024; given the possibility that it will not be transposed before the end of the year and given that the CSRD entered into force on 1 January 2024, there are reasonable doubts as to how to proceed if it is not transposed before the end of the year. That is why, in the absence of news about a possible transposition, the CNMV and the ICAC have taken the initiative and warned companies about their publication obligations, even if the transposition into Spanish law is delayed.
Disclosure and compliance obligations are becoming increasingly important in the context of European regulation, and this importance is intensified when it comes to sustainability.
The Comisión Nacional del Mercado de Valores (CNMV) and the Instituto de Contabilidad y Auditoría de Cuentas (ICAC) have issued a joint statement in view of the possible failure to transpose the Corporate Sustainability Reporting Directive (EU) 2022/2464 (CSRD) and the European Sustainability Reporting Standards (ESRS) into Spanish law by 31 December 2024.
The CSRD replaces the previous Directive (EU) 2014/95/EU of 22 October, which introduced the obligation to include in the management report a statement of non-financial information (NFI) on environmental and social issues, as well as on personnel, respect for human rights and the fight against corruption and bribery.
The main considerations of this statement:
- Companies and their verifiers are advised, even if the CSRD is not transposed in time in the Spanish legal system, to prepare their annual sustainability report as of 1 January 2025 in accordance with the CSRD and the ESRS.
- CSRD broadens its scope compared to Law 11/2018
- The communiqué seeks the comparability of the reports published in Spain with those of the rest of the entities in the European Union and thus correctly assess the developments made in recent years.
- When drafting the Sustainability Report based on the CSRD and following the ESRS, it should be carefully assessed that the report continues to comply with the requirements of the current Law 11/2018, as there are transitional provisions and specific breakdowns not expressly contemplated in the ESRS.
- Given that Law 11/2018 already established the obligation to verify by an independent verifier the content of the ESRS, but did not indicate who could carry out this verification, nor the rules for its performance, nor its scope, until the ICAC's technical verification standard is approved, it is recommended that this verification be carried out by an independent third party.
In summary, as of 1 January 2025, and until the regulations transposing the CSRD are published and come into force, the CNMV and the ICAC recommend that companies that were or will fall within the scope of application of the future standard begin to present Non-Financial Information Statement (NFS) reports under the indications of the CSRD, the COESA guidelines and the IAASB international standard, as well as using the ESRS. This is provided that, after assessing the compatibility of these new considerations with the non-financial information in their reports, compliance with all legal requirements is ensured.
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