On 21st April 2021, the European Commission adopted a proposal for a Corporate Sustainability Reporting Directive, which would amend the existing reporting requirements of the NFRD. The proposal:
- Extents the scope to all large companies and all companies listed on regulated markets (except listed micro-enterprises)
- Requires the audit (assurance) of reported information
- Introduces more detailed reporting requirements and a requirement to report according to mandatory EU sustainability reporting standards
- Requires companies to digitally ‘tag’ the reported information, so that it is machine-readable and feeds into the European single access point envisaged in the capital markets union action plan.
The proposal for a CSRD envisages the adoption of EU sustainability reporting standards, which would be developed by the European Financial Reporting Advisory Group (EFRAG). Standards will be tailored to EU policies, whilst building on and contributing to international standardisation initiatives.
The first set of standards would be adopted by October 2022.