▷ Report Highlights Ambiguity About Reporting Requirements In First Wave Of …


01.02.2022 – 16:30

The Conference Board

BRUSSELS, June 1 /PRNewswire/

Heute hat The Conference Board published a report about the new taxonomy regulations of the EU. The study by the member-supported think tank highlights the ambiguity of disclosure requirements and recommends a roadmap for taxonomy reporting by companies that have not yet started reporting.

As the analysis shows, the EU aims to be climate neutral by 2050 by accelerating and incentivising investments in sustainable activities. In the absence of a definition or systematic guidance as to what is sustainable, the EU has introduced a framework that classifies “green” economic activities. A company then uses this system to report and disclose how its operations align with the definition of “sustainable” in conforms to the EU taxonomy

While the implementation deadlines have been extended to give the market a little more time to prepare, the timeframe remains tight given the heavy workload involved in preparing the reporting. Companies that fall within the scope will have to report on their “eligible” economic activities from 2022. And from 2023 they will have to report the taxonomy alignment of their activities.

To help companies prepare for what lies ahead, beats the report suggest several steps companies can take:

  • Companies in Europe need to prepare for the first version of Taxonomy reporting in their 2022 annual or sustainability reports. This will cover the 2021 financial year. Expanded disclosure will be required from 2023. Companies have a tight timeframe given the amount of preparation required for implementation.
  • Parts of the taxonomy and associated reporting requirements are not finalized, so companies in Europe need to follow these developments closely. The European Commission has adopted a “delegated act” only for the first two objectives: climate change mitigation and climate change adaptation. The second delegated act is expected to be published in 2022.
  • Companies that are not subject to the EU taxonomy should consider whether they are willing to report on a voluntary basis. Companies whose economic and environmental goals are well aligned can use this information to advertise to improve their reputation. Also, it can attract funding, and investors will ask for it.

“It is alarming how little European business is paying attention to the implications of the EU taxonomy,” said Sara Murray, Managing Director, International, of The Conference Board. “By publishing our report now, we are making our MEPs aware of this important one If they have not already done so, raise awareness of this issue and make them understand that if they have not already done so, they need to prioritize this issue.This issue has significant implications for a wide range of stakeholders – not just investors and wealth managers

“As Europe continues to forge the next iterations of taxonomy disclosure rules, companies should also keep a close eye on developments in other jurisdictions,” said Anuj Saush, Head of the Governance & Sustainability Center at The Conference Board. “The UK as well as Canada, China , Malaysia, Singapore and South Africa are also working on a taxonomy”

Information on the Conference Board

The Conference Board is a member-driven think tank that provides authoritative insight into the future. Founded in 1916, we are a nonpartisan, nonprofit organization with 501(c)(3) tax-exempt status in the United States. www.conference-board.org

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