Raison Recap – June 21st 2024

Summer vacation is around the corner for many and work is probably busier than ever pushing towards the pre-vacation deadlines. To help you get on with your busy schedules, here’s a recap of the biggest headlines in sustainable investments and corporate sustainability over the past week.


PwC’s first CSRD survey suggests that things may not be so bad after all

Last week, PwC shared the results from their first inaugural Corporate Sustainability Reporting Directive (CSRD) survey, taking the temperature of 547 executives and senior professionals across more than 30 countries, half of which are set to report for FY2024, the remaining for FY2025. Given the growing sources of discontent from the CSRD practitioner community over the past few months, it is reassuring to see that while significant implementation challenges remain, 97% of the respondents state they feel confident they will make the reporting deadline in time. Not surprisingly, confidence levels drops significantly for the lesser-known sustainability topics to most companies (biodiversity being the most challenging). The perhaps most interesting finding in the survey is that companies are applying very different levels of granularity in their double materiality assessment, which mirrors our experience. Close to half of the respondents report that they have assessed less than 60 impacts, risks and opportunities and only 7% have looked at more than 100 – this “even after applying a materiality threshold” (By the way: does anybody know what that sentence actually means?)

Download the survey here: Global CSRD Survey 2024 | PwC

The Nature Restoration Law appears to have made it after all – or has it?

All eyes were on the EU Council this week, following the March backlash against the EU Nature Restoration Law (#NRL), and its aim to reverse the drastic decline of Europe’s nature as covered in our March 28th Recap. The vote, which was passed with just 1% over the required majority, comes at a time with growing concerns over the watering out of the #EUGreenDeal, which were further amplified as the results from the EU Parliament election trickled in last week. Meanwhile, it now turns out that the deciding vote from Austria’s Environment Minister, Leonore Gewessler, may have been out of line with the mandate given to her by the Austrian Chancellor, which was to abstain from the vote. As Austria’s People Party is already seeking to file criminal charges against the Gewessler for abuse of office, let’s hope this particular drama is chalked up to domestic matters, so the work to restore EU’s land and sea areas back to health can continue.

For some more insight into the Austrian drama that played out after the vote, see here

New recommendation forebodes significant changes to SFDR

And finally, an important publication for our friends and clients on the investment and fund manager side! This week the European Supervisory Authorities (ESAs), published a new set of recommendations based on last year’s comprehensive review of the Sustainable Finance Disclosure Regulation (SFDR), which we also covered in more detail back then. Among the most noteworthy points, it highlights the growing concern from EU’s collective financial authorities that SFDR is being misinterpreted by financial market participants as a “labelling scheme”, creating confusion for investors. In response hereto, the ESAs propose a new system in conjunction with SFDR, which would categorize financial products (e.g. an investment fund) as either a “Sustainable” product or a “Transition” product. The “Sustainable” category would include products that invest in economic activities and assets that are already environmentally or socially sustainable, while the Transition category would include products that invest in activities or assets that are aiming to become sustainable over time. The recommendation also called out the general confusion between the two definitions of “sustainable” under SFDR and the EU Taxonomy, urging greater alignment between the two and for the EU Commission to complete its Social Taxonomy – both of which would be welcome steps in our opinion!

For a neat summary, see ESG Today’s coverage here

If you have more time on your hands, click here for access to the full opinion from the ESAs:


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