Revision of the Non-Financial Reporting Directive: Consultation Open Now
As part of the European Green Deal, the Commission committed to review the Non-Financial Reporting Directive (NFRD) in 2020 as part of a strategy to strengthen the foundations for sustainable investment. A wide consultation process has been launched aimed at collecting the views of stakeholders for possible revisions.
The NFRD lays down the rules on disclosure of non-financial information by large companies. Since 2018, companies with more than 500 employees are required to include non-financial statements in their annual reports, disclosing the way they operate and manage social and environmental challenges.
The need for a review of the NFRD comes from several substantial issues identified in previous years - corporate non-financial disclosures are often lacking, incomplete or insufficiently transparent and reliable. Investors are increasingly asking companies for “green” disclosures and the need for closing the “sustainability reporting gap” as Executive Vice President for Economic Affairs Valdis Dombrovskis puts it, is increasingly important.
As a first step in the review of the directive, stakeholders were invited to comment on a NFRD Roadmap, laying out potential policy options to follow. As a second step, the European Commission has now opened a public consultation for stakeholders to share their views on. Interested parties are invited to reply by 14 May 2020.
The NFRD is an important tool for investors, consumers, policymakers, and other stakeholders to evaluate the non-financial performance of large companies and encourages these companies to develop a responsible approach to business.
On March 26, join CSR Europe's webinar for an updated on the revision of the Non-Financial Reporting Directive. Register here