ESMA on ESG Enforcement Actions

Posted on April 3, 2020 by Editor

The recent European Securities and Markets Authority (ESMA) annual report on enforcement of corporate disclosure demonstrates the increased attention paid by regulators to Environmental Social and Governance (ESG) disclosures.

The report presents the 2019 activities of ESMA and European accounting enforcers when examining the compliance of financial and non-financial statements provided by European issuers.

Enforcement is designed to foster a harmonised approach to the application of IFRS standards in financial statements across Europe – with a focus on examining adherence to new and updated standards.

This year, however, to reflect increasing investor demand for high quality relevant ESG disclosure, EU market regulators focused further enforcement efforts on non-financial statements, examining 35% of statements and leading to 95 enforcement actions.

ESMA is also assisting the European Commission in the review of the non-financial reporting directive to ensure appropriate standards for non-financial reporting are established.

In the upcoming year, ESMA and national authorities will continue to focus enforcement on the application of relevant IFRS standards and ESG disclosures, and will also promote supervisory harmonisation by leading discussions on the implementation of the European Single Electronic Format (ESEF) regulation.

Read more and access the report here.

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