EC asks EFRAG to begin work on EU sustainability standards

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  • EFRAG (European Financial Reporting Advisory Group) (dk green) Image

17 May, 2021

The European Commission (EC) has sent a letter to the European Financial Reporting Advisory Group (EFRAG) to begin work on the European sustainability reporting standards envisioned in the draft Corporate Sustainability Reporting Directive (CSRD) published by the EC in April. The letter notes that in order to meet the tight timeline the EC has set for itself, the development of draft sustainability standards will need to start before the new EFRAG governance structure is in place.

At a high-level conference on 6 May 2021, Mairead McGuinness, European Commissioner for Financial Services, Financial Stability and Capital Markets Union had already indicated that the development of the new standards should be based on the work done by the project task force on preparatory work for the elaboration of possible EU non-financial reporting standards of the European Corporate Reporting Lab, which works under the roof of EFRAG, but is not subject to its governance structure. The letter notes that this approach should be "taken in a pragmatic spirit". However, the letter also notes that the development of the new standards should be handed over to the revised EFRAG governance structure at the earliest opportunity. Further, the letter declares that while EFRAG should aim to submit the first set of draft standards by 15 June 2022, no drafts should be submitted to the EC until EFRAG's revised governance structure has been fully implemented and until the European co-legislators have agreed to the EC's proposals.

Please click to access the letter on the EFRAG website.

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