We are pleased to share the following story from IOSH, Institution of Occupational Safety and Health.
The wave of recognition that people make the strongest contribution in the workplace and so must come first is gathering strength. This is reflected in new European legislation, brought in early this year, which will begin to make its presence felt in 2024.
The European Union (EU) Corporate Sustainability Reporting Directive (CSRD) will drive a significant shift in corporate sustainability reporting that sees the number of companies required to report on economic, social and governance issues of sustainability rise from 11,000 to nearly 50,000, all of them needing to provide much greater detail on their activity.
And while this development will focus initially on companies from EU member states, recording information in 2024 for published reports in 2025, Brexit will only shield UK companies with a ‘substantial’ EU presence for four years. Beginning in 2028, the CSRD will also apply to non-EU companies with a turnover of at least €150 million and a subsidiary or branch either operating in the EU with a net turnover of at least €40 million or as a large or listed subsidiary (these metrics could be subject to change).
Positive move, but…
IOSH Senior Policy and Public Affairs Manager (Global) Dr Ivan Williams Jimenez considers this development a positive move that has the potential to create a culture of greater corporate accountability. However, he also believes it could create a two-tier scenario.
“This increase in the scope of sustainability reporting could be a burden for smaller businesses lagging behind the larger companies operating in Europe who are required to recognise their workers as being material to their organisational success and therefore encouraged to position their people at the heart of how they operate,” he adds.
“Certainly, there are UK employers that take a more positive approach to identifying and managing sustainability risks and opportunities and recognise their workers’ safety, health and wellbeing as being fundamental to their management of human capital, social value and long-term decision-making,” says Dr Williams Jimenez.
“These more enlightened organisations will now have to disclose a wide range of sustainability-related information but will find themselves in a significantly better position in comparison to those UK companies that are less people focused who will be required to step up their adaptation efforts at a relatively fast pace.”
IOSH, which has campaigned for occupational safety and health (OSH) to be acknowledged as ‘material’ to sustainability for 20 years, sees the EU’s CSRD as an opportunity to improve performance reporting and supply chain management. Believing the principles and practice of OSH to be irrevocably linked to social sustainability, IOSH has urged the European Commission to involve OSH professionals in helping to meet this challenge, particularly in developing a new European standard for Non-Financial Reporting.
With CSRD increasing the level of sustainability reporting obligations for business due diligence, including the actual and potential adverse impacts of the company’s operations and value chain, IOSH recommends that its members and other OSH professionals familiarise themselves with the principles of sustainability reporting by accessing its training on Leading, Managing and Working Sustainably and Corporate Governance.