The REP Wrap: Key vote on EU due diligence law delayed
Your weekly summary of corporate sustainability news.
A crucial vote on the EU’s Corporate Sustainability Due Diligence Directive, due to take place this morning, has been postponed. Representatives from the European Council were meant to decide the fate of the ground-breaking law, which will make companies accountable for environmental and social abuses in their supply chains, after the final text was published last week. In a move that has shocked observers, Germany said it planned to abstain from the vote, making it possible that the Directive will fail to make it through the last stage of political negotiations. Italy and Sweden are among other member states expected to try and block the law. Earlier this week, companies including Aldi, Epson, Mars and Bayer signed a statement urging German politicians to approve the law. But the vote was removed from this morning’s Coreper agenda at the last minute, and is expected to be rescheduled to next week.
The UK’s advertising watchdog has banned adverts from carmakers MG and BMW that suggested they offer customers ‘zero emissions’ vehicles. Both firms ran online commercials through Google last year, in which they talked about ‘zero emissions’ cars, but the Advertising Standards Authority that, “while we accepted this was true when driving, we determined this was misleading as they still produced emissions when manufactured or, depending on electrical source, when charging”. A spokesperson said: “We’ve therefore banned these ads and told BMW and MG to ensure they don’t make similar claims without robust evidence in future.”
The Canadian Sustainability Standards Board has said it will launch a consultation next month on three documents that will determine reporting expectations in the country. Based on the ISSB’s standards, but amended to fit the context of the Canadian economy, the proposals will include general rules for disclosing sustainability-related information, along with climate-specific ones.
EFRAG is asking for feedback on plans to make corporate sustainability reports machine readable. The EU’s advisory group has proposed a ‘digital taxonomy’ which will underpin new rules from the European Securities and Market Authority on how to digitally tag information in line with the European Sustainability Reporting Standards. The framework includes illustrative reports and examples of digital ESRS reports. It’s open for consultation until April 8.
This week also saw the sector-specific standards under the ESRS delayed by two years. On the cards for months, the decision has now been confirmed in political negotiations. Requirements for how key sectors should disclose their sustainability performance under the Corporate Sustainability Reporting Directive have been pushed to 2026, to give companies more time to get used to the sector-agnostic standard released last year.
The International Ethics Standards Board for Accountants has partnered with the International Accreditation Forum to promote the use of new conduct rules for people assuring sustainability reports. The Forum will stipulate to national accreditation bodies globally that they should use the new standards, which are currently out for consultation.