European Commission - Speech

Opening remarks by Commissioner McGuinness at the European

Parliament plenary debate on the Corporate Sustainability Reporting
Directive
Brussels, 9 November 2022
Thank you Madam President, good evening colleagues, Honourable Members.
And I'm trying to catch the eye of our very committed rapporteur, and to say at the very outset,
thank you for your passion this evening and your commitment during the process.
It is as a result of that and your collaboration with the shadow rapporteurs that we are able to have
this debate and a sign-off on this important piece of legislation.
I think we are all reminded of the challenges we face, particularly this week as COP 27 takes place in
Egypt.
There is so much to do around climate and biodiversity.
And we need both finance and information to be successful and to change the scenarios which are so
alarming.
And it is a huge challenge.
This debate on the Corporate Sustainability Reporting Directive in my view represents a very
important achievement in our collective efforts towards a more sustainable economy and society.
It will support and steer companies as they make the transition to more sustainable business models
and a more sustainable economy.
The Directive will strengthen the rules on the environmental and the social information that
companies have to report.
For the first time – and this is how significant this debate and this Directive is – we are putting
sustainability reporting on an equal footing with financial reporting.
And this is hugely significant, as other speakers have already alluded to.
We need accurate and reliable information to ensure that investments are being made towards a
more sustainable future.
Companies need the information to plan their transition paths.
And investors need the information to have clarity about what they're investing in and to combat
greenwashing.
Because greenwashing if left unaddressed could reduce investor confidence in sustainable
investment products – not to mention public confidence in sustainable finance and in companies'
efforts to transition.
Clear and consistent disclosure requirements, together with the new assurance requirement, will
improve the reliability of sustainability information.
The final text of the Directive provides a good basis for alignment with the proposed Corporate
Sustainability Due Diligence Directive, which is currently in trilogues.
The text also addresses the particular situation of SMEs.
Only listed SMEs are subject to reporting requirements.
And there are provisions to prevent SMEs in supply chains from being unduly burdened by “trickle-
down” information requests from larger companies.
The European Financial Reporting Advisory Group – EFRAG – is now in the process of improving its
draft standards, so that they are in line with the Directive and implementable by companies.
European standards need to strike a balance between providing useful information for investors and
stakeholders, and the potential cost and burden for reporting companies.
The Commission is fully committed to ensuring that this balance is achieved, considering the current
economic situation.
EU standards must take account of global standards, including the standards currently being
developed by the International Sustainability Standards Board, the ISSB.
Technical discussions between the Commission, EFRAG and the ISSB are taking place to achieve as
much commonality as possible between European and global standards.
So I now look forward to rest of this debate on this really groundbreaking piece of legislation that we
must insist is implemented fully and meets the needs of companies, investors and citizens.
Thank you.
SPEECH/22/6747