28. August 2020
The Accounting Standards Committee of Germany has submitted its feedback to the European Supervisory Authorities (ESAs) on their Draft Regulatory Technical Standard (RTS) “ESG Disclosures” regarding the Sustainable Finance Disclosure Regulation (Delegated Act supplementing Regulation 2019/2088).
From the ASCG’s perspective the Draft RTS lacks a conceptual basis for the non-financial indicators proposed to inform about principal adverse impacts. The draft RTS does not contain any discussion of the characteristics of the users the indicators are designed to address and whether these indicators serve the information needs of those users. Furthermore, the requirements proposed are in conflict with the principle of materiality as the draft RTS even requires the disclosure of zero values.
In addition, the ASCG raises concerns on the general approach taken by both the ESAs and the European Commission. The draft RTS results in transparency obligations for entities that are not in the scope of the Sustainable Finance Disclosure Regulation (SFDR). The disclosure requirements for investee companies are defined on level II (by way of the RTS), which were not the subject of discussions at level I, i.e. the SFRD; and the draft RTS seems to take precedence over the currently discussed amendments to the Non-financial Reporting Directive.
The ASCG submitted its position by using the template required by the ESAs, which can be downloaded here.