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Non-financial reporting, a new obligation for businesses


On 14 December 2022, Directive (EU) 2022/2464 of the European Parliament and of the Council was enacted, which changed the circle of entities obliged to submit non-financial information. The main principle of the directive is to ensure that companies contribute to the sustainable development and transformation of economies and societies by identifying companies that adversely affect human rights and the environment.

ESG (Environmental, Social and Corporate Governance) reporting is a type of non-financial substantiality reporting that concerns categories such as environmental, social and corporate governance issues.

Hitherto, the ESG reporting obligation only concerned public-interest entities (e.g. banks and insurance institutions) that fulfilled certain criteria.

Under Directive 2022/2464, from January 1, 2024, the reporting obligation will be extended to cover large public-interest entities that fulfil jointly at least 2 conditions as of the balance sheet date:

  1. exceed EUR 20,000,000 in balance sheet total,
  2. exceed EUR 40,000,000 in net sales revenue,
  3. employ at least 500 persons (calculated as FTE).

The first ESG reports under the directive will concern the financial year 2024, i.e. they will be prepared in 2025. In the following years, the scope of entities will be successively extended so that all large companies and small and medium-sized listed entities will be covered by this reporting obligation in 2029.

These reports are to include, in particular, information on:

  • the entity's business model and strategy,
  • the sustainability objectives,
  • the role of management with regard to sustainability
  • the entity's policy with regard to sustainable development,
  • the existence of sustainability incentive schemes offered to members of management executive bodies,
  • the due diligence process implemented by the entity in relation to sustainability issues,
  • measures to prevent negative consequences,
  • the main sustainability risks.

Additionally, entities obliged to submit non-financial information will be subject to regulation 2020/852 of June 18, 2020 on the establishment of a framework to facilitate sustainable investment (the so-called Taxonomy). Therefore, such non-financial reports should also disclose information on, inter alia:

  • the percentage of turnover derived from products or services related to business activities that qualify as environmentally sustainable,
  • the percentage share of capital expenditure and operating expenditure corresponding to assets or processes associated with business activities that qualify as environmentally sustainable.

However, it should be underlined that the directive must be implemented into the national legislation in order to be applicable. Poland has until July 6, 2024 to implement those provisions into the Polish legal order; however, no relevant legislation has been drafted as yet.


Żaneta Zakrzewska, Tax Consultant, ATA Tax Sp. z o.o.

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