Council of the EU and European Parliament reach provisional political agreement on new rules on corporate sustainability reporting

On 21 June 2022 the Council of the European Union announced that the European Parliament and the Council reached a provisional political agreement on the corporate sustainability reporting directive (CSRD). The provisional political agreement needs to be formally adopted by Council of the EU and European Parliament in the coming weeks.

The CSRD proposal was published on 21 April 2021. The CSRD will amend the Accounting Directive and will require corporate sustainability reporting.

The final CSRD text has not been published yet. Therefore, information on several unresolved aspects will only be available once the final text is published.

The Council’s press release touches on some of these aspects. According to the press release The application of the regulation will take place in three stages (starting 1 January 2024 until 1 January 2026).

An opt-out will be possible for SMEs during a transitional period, meaning that they will be exempted from the application of the directive until 2028.Reporting must be certified by an accredited independent auditor or certifier.

Georg Lanfermann, President of the ASCG, comments: „This is a huge success for the French Presidency. The provisional political agreement clears the way for a legally binding adoption of the European Sustainability Reporting Standards which EFRAG has currently published for consultation.“

For an overview of the CSRD-proposals and the ESRS Exposure Drafts please go to the ASCG’s website (only in German).