Following in the footsteps of the European Parliament earlier this month, the Council of the EU has now finalised the legislative process by adopting the Corporate Sustainability Reporting Directive (CSRD), a move which is very much welcomed by EFAMA.
This comes days after the first set of
European Sustainability Reporting Standards (ESRS), which give life to
the double materiality principle established by the CSRD, were finalised
by EFRAG and submitted to the European Commission for adoption.
Mandatory
European sustainability reporting standards are crucial as insufficient
availability of ESG data is a key impediment to realising the full
potential of the EU’s sustainable finance regulatory framework. As
information preparers under the Sustainable Finance Disclosure
Regulation (SFDR), asset managers will undoubtedly benefit greatly from
relevant, comparable, reliable and public ESG metrics of companies’
activities and financial risks. However, the first available corporate
reports are only expected from 2025 and the full scope for all
applicable firms will only be in place from 2028 onwards. In the interim
therefore, the chronic lack of corporate ESG data will unfortunately
remain an issue, leading to uncertainty in the sustainable investing
arena.
Tanguy van de Werve, Director General at EFAMA, stated “CSRD
is undoubtedly a crucial piece of the puzzle that will allow asset
managers to further promote sustainable investing and to more accurately
meet their regulatory requirements. We commend the European Commission
for its original proposal and the co-legislators for prioritising this
file. However, with the availability of these corporate reports being
staggered between 2025 and 2029, our industry will be left picking up
the ESG data pieces in the meantime.”
EFAMA
© EFAMA - European Fund and Asset Management Association
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