European Commission publishes climate-related reporting guidelines

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The European Commission has today published new guidelines on corporate climate-related information reporting to provide companies with practical recommendations on how to better report the impact that their activities are having on the climate as well as the impact of climate change on their business.

The guidelines were developed as part of the Commission’s Sustainable Finance Action Plan and ongoing efforts to ensure that the financial sector  can play a critical role in transitioning to a climate-neutral economy and in funding investments at the scale required.

The guidelines integrate the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) established by the G20’s Financial Stability Board.

“The climate emergency leaves us with no choice but transit to a climate-neutral economy model. Today’s new guidelines will help companies to disclose the impact of the climate change on their business as well as the impact of their activities on climate and therefore enable investors make more informed investment decisions,” said Valdis Dombrovskis, Vice-President responsible for Financial Stability, Financial Services and Capital Markets Union.

“I also welcome the three reports by the Technical Expert Group, which are an important contribution to European policy-making and global debate on green finance.”

In addition to the guidelines, Commission welcomes three important expert reports published by the TEG on sustainable finance:

  • classification system – or taxonomy – for environmentally-sustainable economic activities to provide practical guidance for policy makers, industry and investors on how best to support and invest in economic activities that contribute to achieving a climate neutral economy.
  • The report on an EU Green Bond Standard recommends clear and comparable criteria for issuing green bonds and it will  determine which climate and environmentally-friendly activities should be eligible for funding via an EU green bond.
  • Report on EU climate benchmarks and benchmarks’ ESG disclosures sets out the methodology and minimum technical requirements for indices that will enable investors to orient the choice of investors who wish to adopt a climate-conscious investment strategy, and address the risk of greenwashing. The report also sets out disclosure requirements by benchmark providers in relation to environmental, social and governance (ESG) factors and their alignment with the Paris agreement.

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