European companies will now have to include details of their sustainability work in their annual reports.
Companies in the European Union will find it tougher to greenwash under new rules aimed at improving the quality and consistency of environmental reporting. From 2024, the Corporate Sustainability Reporting Directive (CSRD) will require all market-listed EU-based companies to publish detailed information about how sustainability issues such as climate change impact their business and how their operations affect people and the planet. In total, almost 50,000 companies are expected to be impacted by the CSRD, which accounts for three-quarters of business in the European Economic Area. As well as companies listed on regulated markets, companies with more than 250 employees, a turnover of over €40 million, and over €20m of total assets will also need to comply with the new rules. This means that European companies will need to be much more detailed in their sustainability reporting, with science-based environmental targets and climate risk included in their annual reports. That information will need to be qualitative and quantitative, forward-looking and retrospective, and based in the short, medium and long term.