ESMA presents measures to improve corporate sustainability reporting

The European Securities and Markets Authority (ESMA) has issued its final report on the Guidelines for the Enforcement of Sustainability Information (GLESI) and a public statement on the initial application of European standards Sustainability Reporting System (ESRS). These documents are intended to ensure consistent application and oversight of sustainability reporting requirements across the EU.

New Guidelines

The GLESI Guidelines provide a framework for harmonizing supervisory practices in sustainability reporting. "Our aim is to promote a uniform approach between national authorities, increasing the comprehensibility and comparability of sustainability information for investors," ESMA said. The Public Statement aims to support large issuers during the initial phase of ESRS implementation. ESMA is aware of the learning curve associated with these new standards and intends to facilitate the transition. "By providing clear guidance, we hope to facilitate a smoother adoption process for larger companies," ESMA added.

Support of Green Finances

In line with its position paper "Building more efficient and attractive capital markets in the EU", the guidelines focus on:

– Promoting EU capital markets as a green financial centre: They discover information about sustainability.

– Reducing complexity: To ease the compliance burden on the industry.

– Improving supervisory consistency between EU national authorities: Through enhanced cooperation. Until 2025, ESMA will continue to monitor sustainability reporting practices and the implementation of GLESI. GLESI translations will be available in all EU languages on the ESMA website.

ESMA also plans to publish recommendations on listed companies' sustainability statements in its public statement on common European enforcement priorities for 2024 in the fourth quarter.

"ESMA's ongoing efforts are aimed at building a robust framework for sustainability reporting, ensuring that European capital markets remain at the forefront of green finance," ESMA said.