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EFRAG has unveiled its proposed EU Sustainability standards tailored for Small and Medium-sized Enterprises (SMEs).

The Corporate Sustainability Reporting Directive (CSRD) came into force at the start of 2024 for large public-interest companies employing over 500 individuals. Subsequently, companies with more than 250 employees or generating revenue exceeding €40 million will be subject to the CSRD in 2025, while listed Small and Medium-sized Enterprises (SMEs) are scheduled for compliance in 2026.

The recently introduced standards for Public Interest Small and Medium-sized Enterprises (SMEs) comprise comprehensive sections encompassing general requirements, disclosures, and policies, actions, and targets. These standards also include specific metrics related to environmental, social, and business conduct. Notable environmental disclosures encompass details on energy consumption and mix, Scope 1, 2, and 3 emissions, information on greenhouse gas removals financed through carbon credits, expected financial implications of physical and transition climate risks, as well as information on pollution, microplastics, water consumption, and biodiversity impacts.

According to EFRAG, the mandated sustainability standards aim to facilitate improved access to financing for SMEs and promote the availability of standardized sustainability information.

In conjunction with the release of the new draft standards, EFRAG has initiated a consultation on the exposure drafts, and the consultation period will remain open until May 21, 2024.

Click here to access the new SME sustainability reporting standards

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