19 Mar 2024

ECG response to ESMA consultation on draft Guidelines on Enforcement of Sustainability Information (GLESI)

The ECG welcomes the opportunity to comment on ESMA’s draft guidelines and supports the objective to establish consistent, efficient and effective enforcement of sustainability information.

The ECG highlights the following points:

(1) While the ECG recognises ESMA’s aim to align the GLESI with the existing Guidelines on Enforcement of Financial Information (GLEFI), we question whether this strict alignment is appropriate given the inherent differences between financial and sustainability reporting, such as the double materiality principle in sustainability reporting, the fact that it is not all combined in overviews expressed in monetary terms and, importantly, that sustainability reporting is aimed at a range of different users. There is also a difference in the level of maturity of collecting, processing and assessing sustainability data, compared to financial data.

(2) We note that the Transparency Directive requires ESMA to issue guidelines on the supervision of sustainability reporting by national competent authorities. We question whether changing the EU legislators’ wording from “supervision” to “enforcement” to align with GLEFI does not risk losing the preventive aspects of supervision, aimed at sharing knowledge and views to promote consistent compliance.

(3) The ECG believes that regular dialogue the dialogue between ESMA/national competent authorities and the audit profession/other assurance and verifiers, also at a national level, will be very helpful to share findings and exchange on issues encountered, with the ultimate aim of supporting decision-useful sustainability reporting in the EU.  

Read the full ECG response