Tag: corporate sustainability reporting directive

Will U.S. companies face ESG reporting requirements in the EU?

Some U.S. companies may well have to report on ESG—even if the SEC takes no action on climate or other ESG disclosure proposals!  How’s that?  According to this press release from the Council of the European Union, the Council and the European Parliament reached a provisional agreement last week on a corporate sustainability reporting directive (CSRD) that would require more detailed reporting on “sustainability issues such as environmental rights, social rights, human rights and governance factors.” The provisional agreement is subject to approval by the Council and the European Parliament. The press release indicates that the requirements would apply to all large companies and all companies listed on regulated markets, as well as to listed small- to medium-size companies (“taking into account their specific characteristics”). Importantly, for companies outside the EU, “the requirement to provide a sustainability report applies to all companies generating a net turnover of €150 million in the EU and which have at least one subsidiary or branch in the EU. These companies must provide a report on their ESG impacts, namely on environmental, social and governance impacts, as defined in this directive.”