In 2014, the European Union adopted the Corporate Social Responsibility reporting obligation, which is to be implemented by Directive 2014/95/EU. This extended the non-financial reporting obligations of companies. The CSR Directive will also be transposed into national law from January 1, 2017 - violations will be punished with fines of up to ten million euros.
Corporate social responsibility - disclosure obligations for companies
From January 1, 2017, the group of companies that have to publish a sustainability report will be expanded. Companies that violate the legal regulations will face a fine of up to ten million euros. This applies to companies with a balance sheet total of more than 20 million euros or a turnover of more than 40 million euros. The obligation to disclose sustainability also applies to companies with more than 500 employees. The German government obliges all companies that operate in the form of "capital market-oriented" corporations to act sustainably. The obligation to report on sustainability also applies to insurance companies and credit institutions with the above-mentioned criteria - regardless of their legal form. It is estimated that around 550 companies in Germany are affected by the reporting requirement. Earlier estimates assumed that around 6,000 companies would be affected by the new law - meaning that the legal regulations are much broader than previously assumed. The burden on small and medium-sized companies will be kept very low.
Acting sustainably - which topics are covered?
The obligation to disclose sustainability takes into account the following issues:
- Environmental issues, in particular water and energy consumption, greenhouse gas emissions and air pollution
- Employee matters, in particular health protection, safety at work and equality
- Social issues, in particular dialog at regional level
- Combating bribery and corruption
The fine of up to ten million euros is significantly higher than the fine of 50,000 euros recommended by the European Union. Companies that want to act sustainably and provide evidence of this must spend around 40 working days preparing a sustainability report. The amount of time and money required to prepare a corporate social responsibility report ultimately depends on the size of the company.
