Last updated: 13 May 2024
The Directive no. 2022/2464 regarding corporate sustainability disclosure, known as ”CSRD” (Corporate Sustainability Reporting Directive), was transposed in the Romanian legislation under the Order no. 85/2024 of the Public Ministry of Finances, published in the Official Journal no. 75/2024.
The European regulation is aimed at harmonizing corporate reporting and foster ESG data (environment, social and governance) availability and quality. The Directive no. 2022/2464 is also intended to replace the NFRD Directive (Non-Financial Disclosure Directive) having introduced the first extra-financial reporting requirements and regulating the disclosure of non-financial data (Raportarea privind durabilitatea, in Romanian) by companies with an average headcount over 500 employees at the end of the financial year.
What's new?
The new regulation sets out the framework for standardizing data to be disclosed by the undertakings in order to allow a comparison between non-financial data submitted by countries across Europe.
The transposition process also impacted on terminology, with the Romanian legislator replacing the former « declaratia nefinanciară 1» with « raportarea privind durabilitatea2 » .
The sustainability reporting is defined under the Order as ”disclosure by the relevant undertakings of data related to sustainability as encompassing environmental, social, human-rights related, and governance factors”.
Deadlines and relevant undertakings
Qualify as relevant undertakings the undertakings subject to enforcing the accountancy rules according to the Order of the Ministry of Public Finances no. 1.802/2014 and the Order of Public Finances Ministry no. 2 844/2016 (listed companies).
Under the Order no. 85/2024, the reporting obligations include:
- Starting with January 1st, 2024 - public interest entities3, whether or not listed, large and medium-sized companies as defined under the Order no. 1802/20144 and with more than 500 employees, as well as public interest entities parent companies of large groups with more than 500 employees;
- Starting with January 1st, 2025 – all other entities that no longer meet the criteria listed by the Order no. 1802/2014, as well as parent companies of a large group;
- Starting with January 1st, 2028 – entities from third party countries, subject to compliance with the conditions set out by the Directive.
Which data?
The companies must include in the annual report of the directors (for large and medium-sized undertakings), in a dedicated section, data regarding:
- the business model and the strategy of the undertaking (resilience of the business model, sustainability related opportunities for the entity, other data listed under article 49212 of the Order no. 85/2024);
- a description of time-bound sustainability targets (including, as appropriate, absolute targets on greenhouse cuts at least for the period 2030–2050);
- a description of the role of the management and surveillance bodies in the sustainability strategies and their related skills;
- a description of the sustainability policies of the entity;
- data on the existence of an incentivising mechanism for sustainability aspects at the disposal of the members of management and surveillance bodies;
- more data regarding, among others, the main actual or potential negative impact of the operations or the products and services of the undertaking, of its business relationships or its supply chain etc.;
- identify the main sustainability risks of the company (including the entity’s dependency relationships in matters of sustainability);
- the adequate indicators for presenting the hereinabove data shall be included in this section.
In addition to the data provided under the hereinabove report, large and medium-sized undertakings shall also present the identification and collection procedure for the data included in the report of the directors.
Sustainability reporting by subsidiaries shall comply with the formalism provided by the rules approved by the European Commission under article 40b of the Directive no. 2013/34/EU, as supplemented by the Directive (EU) no. 2022/2.464.
By derogation from this provision, such reporting can also be drafted according with the sustainability reporting rules adopted by the European Commission based on article 29b of the Directive no. 2013/34/EU, as supplemented by the Directive (EU) no. 2022/2.464.
The report of the directors of the entities subject to reporting shall have the form of the electronic report provided under article 3 of the Commission delegated regulation (EU) 2018/815 of December 17, 2018.
Notes
1. ”non-financial reporting”
2. ”sustainability reporting”
3. Public interest entities are companies / national undertakings, fully or majority State-owned companies and self-governed companies.
4. No longer meeting at least two of the following criteria: a) total assets: the equivalent of 3,946,953 euros ; b) net turnover: the equivalent of 7,893,906 euros; c) average headcount: 50.