By Huw Jones
LONDON (Reuters) – The European Commission’s decision to deprioritise corporate disclosure rules for oil, gas and other sectors like mining risk diluting the bloc’s push to reach a net-zero economy on time, enviromental groups, trade unions and investors have said.
The European Union’s executive is finalising details of its Sustainability Reporting Standards, broad disclosure rules that about 50,000 companies will use to make environmental, social and goverance (ESG) disclosures in annual reports from 2024.
But the Commission last month indicated a possible delay in more detailed sector-specific standards when it called on the European Financial Reporting Advisory Group to instead prioritise implementing the broader guidelines.
EU financial services commissioner Mairead McGuinness said at the time she wanted to ease burdens on all stakeholders, and free up resources to implement the first set of general disclosures, whose final version would be published for public comment soon.
Around 20 groups, including World Benchmarking Alliance, Finance Watch, Eurosif, WWF, CDP, and Share Action have called on the Commission to set a “clear timeline and commitment” for the sector-specific standards.
“The timeline needs to be clarified for the first two sector-specific standards on mining and oil and gas, which are already at an advanced stage of development,” the letter to commission president Ursula von der Leyen and McGuinness, said.
It is necessary to “maintain continuity” in the development of sector-specific standards, the letter seen by Reuters said.
The letter also urged the commission not to exclude or postpone any parts of the general ESG disclosure standards now being completed.
One environmental campaigner said the letter’s signatories fear the EU’s proposed Net Zero Industry Act – the bloc’s response to the U.S. Inflation Reduction Act to promote investment in clean technology projects – is a “trojan horse” to weaken corporate sustainability disclosures.
The EU is already facing challenges to make ESG disclosure rules for asset managers and the bloc’s taxonomy or guide to sustainable investments, usable.
(Reporting by Huw Jones; Editing by Conor Humphries)
