One of the key trends in CSR is how Europe is looking at the reporting of non-financial information. There is a concerted effort to show how CSR practices underpin the Europe 2020 Strategy for smart, sustainable and inclusive growth. This commitment was clearly demonstrated by the European Commission’s adoption in April 2013 of a proposal for a directive enhancing the transparency of certain large companies on social and environmental issues. This EU Directive amends the current Accounting Directives. (Please see frequently asked questions here)
The companies concerned will need to disclose information on policies, risks and results as regards environmental matters, social and employee-related aspects, respect for human rights, anti-corruption and bribery issues, and diversity on the boards of directors.
The proposed legislation is receiving strong support from the European Parliament particularly the French and Danish governments, with both countries already having national reporting legislation as part of their National Action Plans on CSR.
In May, BITCI participated in a CSR Europe workshop on disclosure of non-financial information. The Deputy Head of the Danish Commerce and Companies Agency (similar to our IDA), Victor Kjaer, outlined the positive Danish experience of introducing law where analysis over the past 5 years shows positive economic impacts for companies and gains in competitive advantage due to increased international transparency and adoption of sustainable business practices. Presently 94% of Danish companies are reporting on non-financial issues, and research indicates that companies are seeing an increase on the return in investment in their CSR programmes by reporting on them. Europe is looking to the Danish experience, with Mr Kjaer stating that ‘long term thinking supports economic growth; short term thinking created the financial crisis’.
Our own Department of Jobs, Enterprise and Innovation has committed to development of an Irish National Action Plan (NAP) on CSR under the Action Plan for Jobs 2013. Our NAP will be designed to best suit the Irish economic, social and environmental conditions. The European Commission’s communication A renewed EU strategy 2011-14 for Corporate Social Responsibility (October 2011) supports the aim that each member adopts a NAP with each county having the flexibility to define their priorities and policy instruments.
As the national CSR business network, BITCI are actively engaged with the Department on the NAP process and will work with our members over the coming months to bring the network’s experience and voice to the policy makers. To date over 12 member states have adopted NAPs so we can learn from these experiences and design a policy that best suits the needs of Irish industry and society.
It will be 2017 when the Directive starts being transposed into national law, so companies need to prepare now in thinking about how this will impact on how reporting and measuring your impacts on communities, the environment, employees and supply chain. Through the BITCI network and frameworks such as the Business Working Responsibly Mark, corporate Ireland can ensure we are well positioned to reap the economic and social benefits from increased transparency, and sustainable business practice.
Author: Bernadette Phelan, Membership Service Manager
Support in CSR & Sustainability reporting is one of the many benefits our Membership Services team provide so if you would like to find out more please contact Bernadette Phelan, Membership Services Manager at email@example.com
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