ESG reporting and preparation of a Sustainability Report

Internal Benefits

• Increased understanding of risks and opportunities
• Emphasizing the link between financial and non-financial performance
• Influencing long-term management strategy and policy, and business plans
• Streamlining processes, reducing costs and improving efficiency
• Benchmarking and assessing ESG performance with respect to laws, norms, codes, performance standards, and voluntary initiatives
• Avoiding being implicated in publicized environmental, social and governance failures
• Comparing performance internally, and between organizations and sectors

External Benefits

• Improving reputation, brand awareness and loyalty
• Company leaders who regularly publish a report on ESG development, can receive feedback on the programs and activities they reported on in the past period via the report
• Mitigating negative ESG impacts
• Enabling external stakeholders to understand the company’s true value
• Demonstrating how the company influences, and is influenced by, expectations about sustainable development
• Investors monitor the values and trends of non-financial indicators to receive an overall picture of the company's future performance
• Journalists can find inspiration for their articles in the report and often promote the company's reputation by expanding the topics
• Many credit rating agencies incorporate ESG factors into their methodology.
   

EU Regulation

Directive 2014/95/EU – the non-financial reporting directive (NFR Directive) – lays down rules on disclosure for non-financial and diversity information by large companies. Companies are required to include non-financial statements in their annual reports.

The NFR Directive requires that companies provide with relation to these matters as a minimum the following information:

• A brief description of the undertaking’s business model,
• The outcome of policies,
• The principal risks related to those matters linked to the undertaking’s operations including, where relevant and proportionate, its business relationships, products or services which are likely to cause adverse impacts in these areas, and how the undertaking manages such risks,
• Non-financial key performance indicators relevant to the business.

The NFR Directive encourages the use of voluntary standards and frameworks for sustainability and ESG reporting.
 

Slovak regulation

The NFR directive has been implemented into the Slovak Act on Accounting No. 431/2002 Coll. as amended.

A public-interest entity with an average number of employees for the accounting period exceeding 500, must also provide in its annual report non-financial information regarding the development, performance, position and effect of the accounting unit activity on:

• Environmental, social and employment issues,
• Information regarding the respecting of human rights and
• Information concerning the fight against bribery and corruption.

The company may apply for an exemption if its parent company prepares and issues an ESG report in line with an acceptable framework or standard.

However, more and more companies are voluntarily preparing and presenting ESG information over and above industry and legal requirements, to describe their long-term value creation strategies and to meet the demands of investors and other stakeholders.
 

1.  Aspects of ESG Consulting

• Identification, collection and evaluation of the relevant requirements of all stakeholders through structured stakeholder dialogue questionnaires and subsequent assessment.
• Set up the concept and compilation of contributions to the ESG report based on GRI Standards methodology. Ensure the structure of the strategic framework of the sustainability and ESG development goals, verification according to GHG protocol or the AA1000 standard.
• Management of risks and opportunities arising in connection with ensuring sustainable company growth.
• Ensure the coordination of cooperation with representatives of individual programs or departments.
• Supervision of the information balance of the report with regard to the strategic importance of individual topics with an emphasis on accurate and transparent reporting.
• Reporting process automation; identification and implementation of technologies that can be used in monitoring goals and metrics and in preparing an ESG report.
• Set the optimal communication strategy, external and internal communication, including the preparation of supporting materials.
• Evaluate the annual results, identify weak points and formulate recommendations for the next period in order to achieve the declared goals of the medium- or long-term strategy.
   

2.  Assurance

• Undertake an independent audit of the data and metrics published in the ESG report and verification of compliance with the methodology or the declared level of methodology.

We will be your trusted adviser and assist you in your sustainability and ESG reporting journey.

We will support your growth to give you a competitive advantage and provide a value-adding service by applying our knowledge and hands-on experience in the relevant area.