• News

CSR Europe: Calling for beyond compliance and welcoming the new era of sustainable development

source:goldencsr    date:2024-06-17 16:18:27

On June 14, 2024, at the 19th International CSR Forum held in Beijing, Jan Noterdaeme, Senior Advisor and Co-founder of CSR Europe, and Morris Massarutto, Project Manager of the Market and EU Working Group, interpreted the complex sustainable regulatory landscape of Europe against the backdrop of the newly elected European Parliament, and shared their efforts to accompany the enterprises to understand and navigate the difficult framework. Meanwhile, CSR Europe also expressed their expectations to the new elected European leaders in their Business Manifesto. 

Here are the main points of the speech:

This week, European citizens have just voted for their representatives in the European Parliament, and in a few weeks, the new President of the European Commission will be announced. At this critical moment, CSR Europe — an organization composed of leading enterprises and national networks — has conveyed the voice of forward-looking enterprises to the incoming new EU leaders through a business manifesto.

As Europe’s leading network for corporate sustainability and responsibility, our association is a membership organization that brings together corporate members and national partner organizations from EU member states. We are committed to promoting issues such as sustainable reporting, supply chain sustainability, due diligence, and transparency, which not only engage us but also bring a sense of fulfillment to our work. Meanwhile, the European Commission and the EU have already established corresponding regulations in these areas.

Let’s start with an overview of the European regulatory landscape, particularly the Corporate Sustainability Reporting Directive — an important piece of legislation concerning sustainable finance. This directive requires both European and non-European enterprises to formulate strategies and report on their sustainable development performance. For the first time, the EU has introduced a mandatory framework that includes the European Sustainability Reporting Standards, applicable to all relevant enterprises. From the fiscal year of 2028, enterprises must comply with this legislation and publish reports based on a double materiality approach in 2029, which means enterprises must report not only their impact on the environment and society but also the financial impact of society and the environment on their business. EU member states need to transpose this legislation into national jurisdiction by July 6, and non-European enterprises with branches or subsidiaries in EU member states should also pay attention to the updates of national regulations.

A few months ago, the Corporate Sustainability Due Diligence Directive was passed, requiring all relevant enterprises to carry out due diligence, establish workflows, and integrate due diligence into their policies. This includes identifying potential adverse impacts in the value chain, preventing and mitigating these impacts, and taking remedial measures when necessary. This directive is closely linked to the Corporate Sustainability Reporting Directive.

The Forced Labour regulation is a regulation targeting the use of forced labor in product manufacturing. It stipulates that any products found to involve forced labor, whether produced within the EU or imported from abroad, will be banned from entering the EU market. This regulation is scheduled to come into effect in the second half of 2027, and before that, the EU will establish a special database and develop guidelines on how the competent authorities should conduct audits.

Similarly, the EU Deforestation Regulation also reflects the EU’s commitment to environmental protection, prohibiting the sale and circulation of products that may lead to deforestation. This regulation will start to be implemented from December 2024 and will gradually apply to all enterprises.

As we can see, Europe’s sustainable compliance is entering a new era. However, we believe that compliance alone is not enough; we need to go beyond compliance. So, what do we expect from the newly elected European leaders? We have summarized that in this business manifesto. 

We hope to reach a European industrial deal to promote closer cooperation between enterprises and EU policy leaders. We hope this deal can become an engine for joint efforts by leaders and enterprises to drive the development of economic competitiveness, environmental responsibility, and social equity in Europe. In addition, we have also proposed some important directions and proposals in our manifesto.

We expect to achieve three strategic directions: First, to make EU legislation more effective, predictable, and workable, and to provide supporting measures that directly support enterprises. Second, we hope that governments of all countries and Europe will invest in sustainable development to promote innovation and value creation. Third, we hope that European leaders will make combating social exclusion a core task of European construction, because we believe that we cannot achieve climate or nature goals if citizens feel left behind.

We have also made some important proposals, including promoting cooperation through the European industrial deal to accelerate the pace of just transition, establishing a European industry alliance for due diligence, and accelerating the construction of the capital markets union and the European social investment framework to guide investors in supporting corporate social activities and contributions.

We firmly believe that in addition to corporate activities related to science based climate targets, initiatives and actions related to humanistic science targets are equally important. We also advocate for sustainable dialogue to promote close cooperation between civil groups, business investors, governments, and the scientific community. The above is our expectation for the next stage of sustainable development in Europe, and we look forward to continuing to share the progress of sustainable development in Europe after this election.

Please click to download CSR Europe Business Manifesto 2024-2029