As policymakers increase efforts to accelerate the transition to a more sustainable economy, the role that companies assume in this transition is becoming more and more crucial. Indeed, a sustainable economy requires joint efforts by all stakeholders involved, which is why corporate sustainability has become an issue of primary importance. Corporate sustainability refers to a management model that differs from the "traditional", driven by the values of growth and profit. In corporate sustainability these values remain important - since sustainability also has an economic dimension - but the company’s growth strategy is implemented according to sustainable development principles and goals, and thus aims to create added value not only for the company, but also for the environment and the society.
Companies are increasingly expected to demonstrate responsible environmental practices and transparency in their operations to comply with regulations and stakeholders’ increasing requests. Environmental Regulations and Standards encompass a wide range of areas, including emissions control, waste management, resource conservation, and pollution prevention.
Sustainability reporting has become one of the most relevant practices for organizations willing to prove their value to stakeholders also through their commitment to ESG considerations and environmental issues. There are several sustainability reporting frameworks available to executives, including a few that have become widely used and are backed by international organizations. It is a rapidly evolving set of choices, as an analysis by the Harvard Business review has pointed out. In this context, GRI standards are designed to be an easy-to-use modular set, delivering an inclusive picture of an organization's material topics, their related impacts and how they are managed.
In the early days of sustainability, many companies viewed it as a regulatory compliance issue. Businesses would do the minimum required to meet environmental standards and then move on, without giving much thought to how sustainability might actually benefit their operations.
GRI (Global Reporting Initiative) is the independent, international organization that helps businesses and other organizations take responsibility for their impacts, by providing them with the global common language to communicate those impacts. It provides the world’s most widely used standards for sustainability reporting – the GRI Standards.
The Sustainability reporting, introduced for European companies with the EU Directive 95/2014, represents to date in the international reporting landscape, the starting point of a continuously evolving path that aims to meet numerous challenges, first and foremost the integrated management of non-financial information, structured in a framework that can be as comprehensive as possible, to be placed alongside classic financial reporting.
The scope of European Union legislation, in the field of accelerating and harmonizing rules on sustainable finance, has expanded considerably in the past few years and is gradually broadening.
The state of the art of European legislation aimed at defining the legislative framework for sustainable investment is certainly the most advanced and defined in the global landscape at present.
In the new framework defined by the European Taxonomy, with regard to the rules and objectives for classifying business activities that are considered environmentally, socially, and governance sustainable, a prominent point much discussed at the moment, especially in the financial world, is covered by Article 8 of the Taxonomy.
If the beginning of the year 2022 has brought great innovations in the development of legislative issues concerning the financial disclosure envisaged by many companies in the process of due diligence in the area of sustainability, this is largely due to the European Union's proposal concerning the 'Corporate sustainability Due Diligence Directive', CSDDD for short, published last February 2022.
We are glad to announce that the European Commission has officially adopted the European Sustainability Reporting Standards (ESRS) as of July 31st.