In the world of corporate law, July 2023 saw quite a number of substantial regulatory developments, particularly with respect to Environmental, Social, and Governance (ESG) factors. The most significant was the European Commission’s adoption of the Commission Delegated Regulation. This introduced the initial set of European Sustainability Reporting Standards (ESRS), alongside a related Q&A as indicated in the press release for that month. (Full details and press release available here). The ESRS has set a precedent for the information that corporations are obligated to report under the Accounting Directive (2013/34/EU), as revised by the Corporate Sustainability Reporting Directive (2022/2464/EU), also known as the ‘CSRD’.
Furthermore, the ESRS has clarified the necessary information needed by financial market participants. Although what all of these regulations entail fully remains to be seen, the shift towards ESG factors’ transparency and accountability is obvious. This reveals an important direction in which the legislative trend is moving. This intriguing new landscape of corporate law requires continuous monitoring throughout its development and implementation.
Brought in by expert law firm, Proskauer Rose LLP, this is the type of crucial information that legal professionals working in large corporations and law firms could stand to benefit from in strategising their approach to upcoming legal and regulatory landscapes. To adapt to this dynamically changing environment, keeping abreast of such regulatory changes is vital.
Given the growing international focus on ESG concerns, these developments surrounding ESG reporting hold substantial significance across the corporate legal field. Not only for those within the confines of the EU, but also for businesses globally that engage with it. This could potentially herald new global standards, influencing how business transactions, agreements, and due diligence processes are carried out.