The Commission clarifies some sustainability reporting rules introduced by CSRD

On 13.11.2024 the EU Commission (“Commission”) has published a set of Frequently Asked Questions (“FAQ”) clarifies the interpretation of certain provisions on sustainability reporting introduced by the Corporate Sustainability Reporting Directive, ‘CSRD’ (Directive (EU) 2022/2464)) into the Accounting Directive (Directive 2013/34/EU), the Audit Directive (Directive 2006/43/EC), the Audit Regulation (Regulation (EU) No 537/2014), and the Transparency Directive (Directive 2004/109/EC) with the aim of facilitating their implementation by undertakings.

Key clarifications on companies’ duties:

• SMEs (excluding micro-undertakings) with transferable securities admitted to trading on an EU regulated market may decide not to report sustainability information under Article 19a of the Accounting Directive for financial years starting before 1 January 2028 (e.g. for financial years 2026 and 2027). In such cases, the SME shall, nevertheless, briefly state in its management report why the sustainability reporting was not provided;
• an SME with securities admitted to trading on an EU regulated market that voluntarily publishes the consolidated sustainability statement referred to in Article 29a o...