The NGO Frank Bold has published a new study on the Non-Financial Information reports of European companies. As part of this study, they analyzed information published by 300 companies from 12 countries in southern, central, and eastern Europe, among whom 58 were Spanish.
The following seven results and conclusions stand out from the study:
- Policies, plans and risks related to climate change – 42% of companies fail to describe the most important risks, while 23% do not report relevant information about the content of their policies and 24% fail to describe the outcomes of their implementation.
- Targets – Only 16% of companies report climate change-related targets or disclose specific risks in a way that takes into account a low-carbon economic model (for example, setting objectives and deadlines for reducing emissions based on science-based methodologies).
- Compliance with Task Force on Climate-related Financial Disclosures (TCFD) recommendations – Only 2 to 28% of companies have disclosed information related to the TCFD risk reporting criteria, such as time horizons, climate scenarios, or management strategies risk.
- Scope 3 emissions – Of the companies studied, 24% report their greenhouse gas emissions (GHGs), and 32% report their greenhouse gas intensity (excluding the financial sector). On the other hand, only 5% publish information related to billing from sustainable activities.
- Environmental issues – The analysis of information disclosed on the use of natural resources, pollution discharges, and issues related to biodiversity shows similar results, only around 10% provide specific details.
- Positive results – Companies that provide specific information about their policies have increased by 16%, according to the study. This improvement is mainly concentrated in Spain, where climate targets are presented 20% more often in the reports.
- Regional differences – While 25% of Southern European companies describe their alignment with science-based climate targets, only 4% of Central and Eastern European companies do so.
Results show a slow but steady development in non-financial reporting, despite the need to develop unified reporting criteria and obligations for the companies of various industries, so that the information the companies need to report can be clarified and doubts about law requirements can be solved.
The update of the European Directive related to the reporting of non-financial information is expected to bring progress in this area. In this document, companies could soon be provided with a guide for the criteria they must use in their reports.
Visit the following links for more information on this study: