BETA

Activities of Silvia MODIG related to 2021/0104(COD)

Shadow opinions (1)

OPINION on the proposal for a directive of the European Parliament and of the Council amending Directive 2013/34/EU, Directive 2004/109/EC, Directive 2006/43/EC and Regulation (EU) No 537/2014, as regards corporate sustainability reporting
2022/03/04
Committee: ENVI
Dossiers: 2021/0104(COD)
Documents: PDF(288 KB) DOC(206 KB)
Authors: [{'name': 'Lídia PEREIRA', 'mepid': 197738}]

Amendments (30)

Amendment 54 #
Proposal for a directive
Recital 15
(15) Articles 19a and 29a of Directive 2013/34/EU apply to large undertakings that are public-interest entities with an average number of employees in excess of 500, and to public-interest entities that are parent undertakings of a large group with an average number of employees in excess of 500 on a consolidated basis, respectively. In view of the growth of users’ needs for sustainability information, additional categories of undertakings should be required to report such information. It is therefore appropriate to require all large undertakings, all public interest entities, all small and medium sized undertakings operating in high-risk sectors or high risk-areas and all undertakings listed on regulated markets, except micro undertakings, to report detailed sustainability information. In addition, all undertakings that are parent undertakings of large groups should prepare sustainability reporting at group level. Undertakings that are not established in the European Union but fulfil those criteria and operate in the single market should be subjected to the same requirements in order to account for their sustainability impacts and to provide a level playing field for undertakings established in the EU.
2021/12/13
Committee: ENVI
Amendment 63 #
Proposal for a directive
Recital 18
(18) Considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (SMEs) listed on regulated markets comprise a significant proportion of all listed undertakings in the Union, in order to ensure investor protection it is appropriate to require that also those SMEs disclose information on sustainability matters. The introduction of this requirement will help to ensure that financial market participants can include smaller listed undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. It will therefore help to protect and enhance the access of smaller listed undertakings to financial capital, and avoid discrimination against such undertakings on the part of financial market participants. The introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in Regulation (EU) 2019/2088. SMEs listed on regulated markets should, however, be provided with sufficient time to prepare for the application of the requirement to report sustainability information, due to their smaller size and more limited resources, and taking account of the difficult economic circumstances created by the COVID-19 pandemic. They should also be given the possibility to report according to standards that are proportionate to the capacities and resources of SMEs. NA timeline should be set for non- listed SMEs can also choose to useto apply these proportionate standards on a voluntary basis. The SME standards will set a reference for undertakings that are within the scope of the Directive regarding the level of sustainability information that they could reasonably request from SME suppliers and clients in their value chains.
2021/12/13
Committee: ENVI
Amendment 71 #
Proposal for a directive
Recital 26
(26) Articles 19a(1) and 29a(1) of Directive 2013/34/EU require undertakings to disclose information about five reporting areas: business model, policies (including due diligence processes implemented), the outcome of those policies, risks and risk management, and key performance indicators relevant to the business. Article 19a(1) of Directive 2013/34/EU does not contain explicit references to other reporting areas that users of information consider relevant, some of which align with disclosures included in international frameworks, including the recommendations of the Task Force on Climate-related Financial Disclosures. Disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. In addition to the reporting areas identified in Articles 19a(1) and 29a(1) of Directive 2013/34/EU, undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters, the assessment by the undertaking of its impacts on sustainability matters, any plans they may have to ensure that their business model and strategy respect workers’ rights and potentially affected communities, any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate- neutral economy; whether and how their business model and strategy take account of the interests of stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect, or are affected by sustainability matters; any science-based and time-bound short-term, mid-term and long-term sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the principal actual and potential adverse impacts connected with the undertaking’s activities; and how the undertaking has identified the information that they report on. Once the disclosure of elements such as targets and the progress towards achieving them is required, the separate requirement to disclose the outcomes of policies is no longer necessary.
2021/12/13
Committee: ENVI
Amendment 87 #
Proposal for a directive
Recital 34
(34) The European Financial Reporting Advisory Group (EFRAG) is a non-profit association established under Belgian law that serves the public interest by providing advice to the Commission on the endorsement of international financial reporting standards. However, the current structure, governance and functioning of EFRAG does not provide for the involvement of workers’ representatives and civil society organisations. For example, EFRAG currently requires stakeholders to pay a fee in order to participate in its work, which is a barrier for the participation of some stakeholders and entails a risk of conflict of interests with others. Important changes regarding the governance of EFRAG are necessary in order to prevent all conflicts of interests and guarantee the inclusion of non- corporate stakeholders. EFRAG has established a reputation as a European centre of expertise on corporate reporting, and is well placed to foster coordination between European sustainability reporting standards and international initiatives that seek to develop standards that are consistent across the world. In March 2021, a multi-stakeholder task force set up by EFRAG published recommendations for the possible development of sustainability reporting standards for the European Union. Those recommendations contain proposals to develop a coherent and comprehensive set of reporting standards, covering all sustainability matters from a double-materiality perspective. Those recommendations also contain a detailed roadmap for developing such standards, and proposals for mutually reinforcing cooperation between global standard- setting initiatives and standard-setting initiatives of the European Union. In March 2021, the EFRAG President published recommendations for possible governance changes to EFRAG if it were to be asked to develop technical advice about sustainability reporting standards. These recommendations include offsetting up within EFRAG a new sustainability reporting pillar while not significantly modifying the existing financial reporting pillar. When adopting sustainability reporting standards, the Commission should take account of technical advice that EFRAG will develop. In order to ensure high-quality standards that contribute to the European public good and meet the needs of undertakings and of users of the information reported, EFRAG’s technical advice should be developed with proper due process, public oversight and transparency, accompanied by cost benefit analyses, and be developed with the expertise of relevant stakeholders. To ensure that Union sustainability reporting standards take account of the views of the Member States of the Union, before adopting the standards the Commission should consult the Member State Expert Group on Sustainable Finance referred to in Article 24 of Regulation (EU) 2020/852 on EFRAG’s technical advice. The European Securities and Markets Authority (ESMA) plays a role in drafting regulatory technical standards pursuant to Regulation (EU) 2019/2088 and there needs to be coherence between those regulatory technical standards and sustainability reporting standards. According to Regulation (EU) No 1095/2010 of the European Parliament and of the Council54 , ESMA also plays a role in promoting supervisory converge in the enforcement of corporate reporting by issuers whose securities are listed on EU regulated markets and who will be required to use these sustainability reporting standards. Therefore, ESMA should be required to provide an opinion on EFRAG’s technical advice. This opinion should be provided within two months from the date of receipt of the request from the Commission. In addition, the Commission should consult the European Banking Authority, the European Insurance and Occupational Pensions Authority, the European Environment Agency, the European Union Agency for Fundamental Rights, the European Central Bank, the Committee of European Auditing Oversight Bodies and the Platform on Sustainable Finance to ensure that the sustainability reporting standards are coherent with relevant Union policy and legislation. Where any of those bodies decide to submit an opinion, they shall do so within two months from the date of being consulted by the Commission. __________________ 54Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).
2021/12/13
Committee: ENVI
Amendment 94 #
Proposal for a directive
Recital 37
(37) Sustainability reporting standards should be proportionate, and should not impose unnecessary administrative burden on companies that are required to use them. In order to minimise disruption for undertakings that already report sustainability information, sustainability reporting standards should take account of existing standards and frameworks for sustainability reporting and accounting where appropriate. Those include the Global Reporting Initiative, the Sustainability Accounting Standards Board, the International Integrated Reporting Council, the International Accounting Standards Board, the Task Force on Climate-related Financial Disclosures, the Carbon Disclosure Standards Board, and CDP (formerly the Carbon Disclosure Project). Standards of the European Union should take account of any sustainability reporting standards developed under the auspices of International Financial Reporting Standards Foundation. To avoid unnecessary regulatory fragmentation that may have negative consequences for undertakings operating globally, European standards should support and contribute to the process of convergence of sustainability reporting standards at global levelto develop standards by the International Sustainability Standards Board.
2021/12/13
Committee: ENVI
Amendment 108 #
Proposal for a directive
Recital 43
(43) Sustainability reporting standards should specify the information that undertakings should disclose on social factors, including employee factors and human rights. Such information should cover the impacts of undertakings on people, including on human health. The information that undertakings disclose about human rights should include information about the impacts on human rights and workers’ rights in their value chains, including but not limited to forced labour in their value chains where relevant. Reporting standards that address social factors should specify the information that undertakings should disclose with regard to the principles of the European Pillar of Social Rights that are relevant to businesses, including equal opportunities for all and working conditions. The European Pillar of Social Rights Action Plan adopted in March 2021 calls for stronger requirements on undertakings to report on social issues. The reporting standards should also specify the information that undertakings should disclose with regard to the human rights, fundamental freedoms, democratic principles and standards established in the International Bill of Human Rights and other core UN human rights conventions, the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work, the fundamental conventions of the International Labour Organisation, and the Charter of Fundamental Rights of the European Union. relevant conventions of the International Labour Organisation and in particular the fundamental conventions of the International Labour Organisation, the European Convention on Human Rights, the European Social Charter, the Charter of Fundamental Rights of the European Union, the United Nations Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.
2021/12/13
Committee: ENVI
Amendment 114 #
Proposal for a directive
Recital 47
(47) To meet the information needs from users in a timely manner, and in particular given the urgency to meet the information needs of financial market participants subject to the requirements laid down in the delegated acts adopted pursuant to Article 4, paragraphs 6 and 7 of Regulation (EU) 2019/2088, the Commission should adopt a first set of reporting standards by 31 October 2022. That set of reporting standards should specify the information that undertakings should disclose with regard to all reporting areas and sustainability matters, and that financial market participants need to comply with the disclosure obligations laid down in Regulation (EU) 2019/2088. The Commission should adopt a second set of reporting standards at the latest by 31 October 2023, specifying complementary information that undertakings should disclose about sustainability matters and reporting areas where necessary, and information that is specific to the sector in which an undertaking operates. The Commission should prioritise the adoption of standards specific to high-risk sectors and high-risk areas. The Commission should review the standards every 3 years to take account of relevant developments, including the development of international standards.
2021/12/13
Committee: ENVI
Amendment 119 #
Proposal for a directive
Recital 47 a (new)
(47a) Undertakings active in the extractive industry as defined in Article 41 (1) of directive 2013/34/EU should be subject to additional sustainability disclosure requirements. Undertakings active in the extractive industry must be required to publish the contracts and other documents upon which these projects are based. Publication of contracts should be accompanied with publication of related impact assessments and management plans.
2021/12/13
Committee: ENVI
Amendment 124 #
Proposal for a directive
Recital 53
(53) The assurance profession distinguishes between limited and reasonable assurance engagements. The conclusion of a limited assurance engagement is usually provided in a negative form of expression by stating that no matter has been identified by the practitioner to conclude that the subject matter is materially misstated. The auditor performs fewer tests than in a reasonable assurance engagement. The amount of work for a limited assurance engagement is therefore less than for reasonable assurance. The work effort in a reasonable assurance engagement entails extensive procedures including consideration of internal controls of the reporting undertaking and substantive testing, and is therefore significantly higher than in a limited assurance engagement. The conclusion of this type of engagement is usually provided in a positive form of expression and states an opinion on the measurement of the subject matter against previously defined criteria. Article 19a(5) and Article 29a(5) of Directive 2013/34/EU require Member States to ensure that the statutory auditor or audit firm checks whether the non-financial statement or the separate report has been provided. It does not require that an independent provider of assurance services verifies the information, although it allows Member States to require such verification where they wish to. The absence of an assurance requirement on sustainability reporting, in contrast to the requirement for the statutory auditor to perform a reasonable assurance engagement on financial statements, would threaten the credibility of the sustainability information disclosed, thus failing to meet the needs of the intended users of that information. Although the objective is to have a similar level of assurance for financial and sustainability reporting, the absence of a commonly agreed standard for the assurance of sustainability reporting creates the risk of different understandings and expectations of what a reasonable assurance engagement would consist of for different categories of sustainability information, especially with regard to forward looking and qualitative disclosures. Therefore, a progressive approach to enhance the level of the assurance required for sustainability information should be considered, starting with an obligation on the statutory auditor or audit firm to express an opinion about the compliance of the sustainability reporting with Union requirements based on a limited assurance engagement. This opinion should cover the compliance of the sustainability reporting with Union sustainability reporting standards, the process carried out by the undertaking to identify the information reported pursuant to the sustainability reporting standards and compliance with the requirement to mark- up sustainability reporting. The auditor should also assess whether the undertaking’s reporting complies with the reporting requirements of Article 8 of Regulation (EU) 2020/852. To guarantee a common understanding and expectations of what a reasonable assurance engagement would consist of, the Commission should adopt assurance standards for reasonable assurance of sustainability reporting by 31 October 2023. The statutory auditor or audit firm should be required to express an opinion based on a reasonable assurance engagement about the compliance of the sustainability reporting with Union requirements, should the Commission adopt assurance standards for reasonable assurance of sustainability reporting. This would also allow for the progressive development of the assurance market for sustainability information, and of undertakings’ reporting practices. Finally, this progressive approach would phase in the increase in costs for reporting undertakings, given that reasonable assurance is more costly than limited assurance.
2021/12/13
Committee: ENVI
Amendment 137 #
Proposal for a directive
Article 1 – paragraph 1 – point 2
Directive 2013/34/EU
Article 2 – paragraph 1 – point 20 a (new)
(20a) A high-impact sector is a sector that is associated, as a result of its size, business and value chain characteristics, with a high likelihood of actual or potential severe impacts on sustainability matters.
2021/12/13
Committee: ENVI
Amendment 141 #
Proposal for a directive
Article 1 – paragraph 1 – point 2
Directive 2013/34/EU
Article 2 – paragraph 1 – point 20 b (new)
(20b) A high-risk area means a geographical area that is associated with a high likelihood of actual or potential severe impacts on sustainability matters
2021/12/13
Committee: ENVI
Amendment 146 #
Proposal for a directive
Article 1 – paragraph 1 – point 2
Directive 2013/34/EU
Article 2 – paragraph 1 – point 20 c (new)
(20c) A target means measurable, specific, time-bound and, when applicable, science-based indicator.
2021/12/13
Committee: ENVI
Amendment 150 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 1
1. Large undertakings and, as of 1 January 2026, small and medium-sized undertakings which are undertakings referred to in Article 2, point (1), point (a) and small and medium-sized undertakings which are high-impact undertakings which exceed on their balance sheet data the criterion of the average number of 10 employees during the financial year, shall include in the management report information necessary to understand the undertaking’s impacts on sustainability matters, and information necessary to understand how sustainability matters affect the undertaking’s development, performance and position.
2021/12/13
Committee: ENVI
Amendment 165 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 – subparagraph 1 – point a – point ii
(ii) the opportunities and risks for the undertaking related to sustainability matters;
2021/12/13
Committee: ENVI
Amendment 169 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 –subparagraph 1 – point a – point iii
(iii) the plans of the undertaking including a transition pathway, comprising of short-term and medium- term absolute emission reduction targets for 2025 and 2030 to achieve carbon neutrality by 2050 at the latest, and implementing actions and related financial and investment plans, to ensure that its business model and strategy are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement; with no or limited overshoot and recourse to compensation technologies, and pursuant to the latest recommendations of the IPCC;
2021/12/13
Committee: ENVI
Amendment 178 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 – subparagraph 1 – point a – point v
(v) how the undertaking’s strategy has been implemented with regard to sussustainability matters and related targets, in connection with principal risks, opportunities, and severe impacts, have been integrated into the undertakinability matters;g’s strategy
2021/12/13
Committee: ENVI
Amendment 181 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 – subparagraph 1 – point b
(b) a description of the targets related to sustainability matters set by the undertakingime-bound short-term, mid-term and long-term targets set by the undertaking with respect to the principal risks, opportunities, severe impacts and timely alignment with relevant public goals, whether such targets are science-based alongside corresponding evidence, implementing actions and related investment plans and of the progress the undertaking has made towards achieving those targets;
2021/12/13
Committee: ENVI
Amendment 190 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 – subparagraph 1 – point e – point i
(i) the due diligence process implemented with regard to sustainability matters in line with applicable EU legislation on due diligence [Directive XXX];
2021/12/13
Committee: ENVI
Amendment 194 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 – subparagraph 1 – point e – point ii
(ii) the principal actual or potential adverse impacts connected with the undertaking’s value chain as identified through the due diligence process, including its own operations, its products and services, its subsidiaries, its business relationships and its supply chain, including information on people affected by those impacts;
2021/12/13
Committee: ENVI
Amendment 201 #
Proposal for a directive
Article 1 – paragraph 1 – point 3
Directive 2013/34/EU
Article 19 a – paragraph 2 – subparagraph 1 – point g
(g) indicators relevant to the disclosures referred to in points (a) to (f), including key performance indicators set out in the delegated act supplementing Article 8 of the Regulation (EU) 2020/852.
2021/12/13
Committee: ENVI
Amendment 233 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 1 – subparagraph 1 – introductory part
The Commission shall adopt delegated acts in accordance with Article 49 to provide for sustainability reporting standards. European standards should support and contribute to the process to develop standards by the International Sustainability Standards Board. Those sustainability reporting standards shall specify the information that undertakings are to report in accordance with Articles 19a and 29a and, where relevant, shall specify the structure in which that information shall be reported. In particular:
2021/12/13
Committee: ENVI
Amendment 238 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 1 – subparagraph 1 – point b – point ii
(ii) information that undertakings shall report that is specific to the sector in which they operate, prioritizing the high-impact sectors referred to in Annex IIa.
2021/12/13
Committee: ENVI
Amendment 241 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 1 – subparagraph 2
The Commission shall, at least every three years after its date of application, review any delegated act adopted pursuant to this Article, taking into considerati. It shall guarantee the involvement of trade unions in that process, and include other relevant stakeholders and civil society organisations. The European Commission may rely on the technical advice of the European Financial Reporting Advisory Group (EFRAG), and where necessary shall amend such delegated act to take into account relevant developments, including developments with regard to international standards.
2021/12/13
Committee: ENVI
Amendment 247 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 2 – subparagraph 1
The sustainability reporting standards referred to in paragraph 1 shall require that the information to be reported is understandable, relevant, representative, verifiable, comparable, and is represented in a faithful manner. When applicable, the information shall be science-based and measurable.
2021/12/13
Committee: ENVI
Amendment 252 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 2 – subparagraph 2 – point a – point i
(i) climate change mitigation; including - emissions on all scopes of greenhouse gas emissions including Scope 1, 2 and 3 GHG emissions; - investment plans and absolute emission reduction targets of the undertaking for 2025 and 2030, reviewed every five years and targeted date to achieve carbon neutrality; and - substantiated explanation on the alignment of the undertaking’s business model and strategy with the goal of limiting of global warming to 1.5 °C with no or limited overshoot and recourse to compensation technologies, pursuant to the latest evidence provided by the IPCC;
2021/12/13
Committee: ENVI
Amendment 253 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 2 – subparagraph 2 – point a – point iii
(iii) water and marine resources; including targets to limit the use and pollution of water;
2021/12/13
Committee: ENVI
Amendment 260 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 2 – subparagraph 2 – point a – point v
(v) pollution; including plastic pollution and diffuse pollution, targets to reduce pollution and detailed plans to achieve those targets;
2021/12/13
Committee: ENVI
Amendment 263 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 2 – subparagraph 2 – point a – point vi
(vi) biodiversity and ecosystems; including targets to reduce biodiversity loss, deforestation and impacts on wildlife, as well as detailed plans to achieve those targets;
2021/12/13
Committee: ENVI
Amendment 273 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b – paragraph 2 – subparagraph 2 – point b – point iii
(iii) respect forimplementation and results of the undertaking’s due diligence process to meet its responsibility to respect human rights, understood as those human rights, fundamental freedoms, democratic principles and standards established in the International Bill of Human Rights and other core UN human rights conventions, the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work and the ILO fundamental conventions and the Charter of Fundamental Rights of the European Union.
2021/12/13
Committee: ENVI
Amendment 285 #
Proposal for a directive
Article 1 – paragraph 1 – point 4
Directive 2013/34/EU
Article 19b a (new)
Article 19ba Sustainability reporting related to Regulation (EU) 2020/852 1. Any undertaking which is subject to an obligation to publish non-financial information pursuant to Article 8 of Regulation (EU) 2020/852 shall include information on how and to what extent the undertaking’s activities are associated with economic activities that do not qualify as environmentally sustainable under Articles 3 and 9 of Regulation (EU) 2020/852. 2. In particular, non-financial undertakings shall disclose the following: (a) the proportion of their turnover derived from products or services associated with, and the proportion of their capital expenditure and the proportion of their operating expenditure related to assets or processes associated with, economic activities that do not meet the substantial contribution criteria but do meet the Do No Significant Harm criteria specified in relevant Delegated Acts under Articles 10 to 15 of Regulation (EU) 2020/852; (b) the proportion of their turnover derived from products or services associated with, and the proportion of their capital expenditure and the proportion of their operating expenditure related to assets or processes associated with, economic activities that do neither meet the substantial contribution criteria nor the Do No Significant Harm criteria specified in relevant Delegated Acts under Articles 10 to 15 of Regulation (EU) 2020/852.
2021/12/13
Committee: ENVI