Berlin, 13 September 2023 - In future, corporate sustainability reports are to be placed on an equal footing with financial reporting and assessed by independent bodies. Before that, the European Corporate Sustainability Reporting Directive (CSRD) must be transposed into national law in Germany. A corresponding draft law is expected soon. Numerous business associations have now approached the Federal Ministry of Justice (BMJ), which is in charge, as well as the Federal Ministry for Economic Affairs and Climate Action (BMWK) and the Federal Ministry of Finance (BMF), calling for an open market for the upcoming mandatory assessments of sustainability reports and warning of capacity bottlenecks. The calls are supported by TÜV-Verband e.V. as representative of the assessment organisations as well as the trade associations of the textile industry (Gesamtverband der deutschen Textil- und Modeindustrie), the chemical industry (Verband der Chemischen Industrie e.V. - VCI), mechanical and plant engineering (Verband Deutscher Maschinen- und Anlagenbau - VDMA), the electrical and digital industry (Verband der Elektro- und Digitalindustrie - ZVEI) as well as the Steel and Metal Processing Trade Association (Wirtschaftsverband Stahl- und Metallverarbeitung e.V. and the WirtschaftsVereinigung Metalle).
"According to the European CSRD legislation, sustainability reports will become mandatory for many companies in the future. Now it is a matter of transposing the requirements into national law according to the needs of the approximately 15,000 companies affected. In addition to financial auditors, technical experts should also be allowed to carry out corresponding assessments of sustainability reports," says Dr Joachim Bühler, CEO of TÜV-Verband e.V. The technical assessment companies have many years of experience in the certification of environmental management systems, the verification of the CO2 footprint of companies or supply chain audits. Bühler: "According to reports, the assessments of sustainability reports in Germany are to be carried out exclusively by financial auditors. The consequences would be already foreseeable capacity bottlenecks among auditors, higher costs that would burden small and medium-sized enterprises in particular, and the danger of inferior assessment results if personnel or technical know-how are lacking. We need an open market based solely on the quality, technical expertise and independence of the firms assessing the reports."
Representatives of the business sectors concerned are also sounding the alarm. "For the external assessment of sustainability reports, we need the broadest possible range of qualified assurance service providers who work at reasonable costs. This is crucial for medium-sized companies that do not have the financial resources of large companies. Germany should follow countries like France, Italy and Spain and, in addition to auditing companies, also allow other accredited assessment bodies, such as TÜV, Dekra, DQS and other organisations," says Thilo Brodtmann, Executive Director of the VDMA. "In addition, it should be possible to link the verification of sustainability reports with ISO auditing."
"There must be no diverging solutions in Germany. Uniformity in implementation is also the trump card with this EU directive. Otherwise, there is a risk of a confusing patchwork together with a disadvantage of our companies compared to competitors from other European countries. The involvement of independent assurance service providers (IASP) increases availability and ensures fair competition," says Wolfgang Weber, Chairman of the ZVEI Board.
"For the implementation of the future sustainability reporting obligations, it is elementary that sufficient capacities and corresponding know-how are available on the assessment side. Particularly in the chemical-pharmaceutical industry, a high level of technical expertise is required from auditors due to the complex value chains and the demanding requirements with regard to climate protection and the circular economy," says Berthold Welling, VCI Managing Director Legal and Taxes, Sustainability. "We expect that assurance service providers will have to diversify and specialise accordingly in terms of sustainability. In this respect, a vital market with different accredited players is needed. It is all the more important to recognise independent assessment organisations, who often have many years of experience in the field of sustainability. Small and medium-sized enterprises in particular would benefit from this," Welling continues.
"The Sustainability Reporting Directive imposes considerable burdens on German SMEs in particular, especially against the background that companies already have to comply with numerous legal reporting obligations. At least when it comes to the question of report verification, the German government should make proportionality and practicability the basis for decision-making," says Dr Uwe Mazura, General Manager of Gesamtverband der deutschen Textil- und Modeindustrie.
From the point of view of the trade associations, it makes neither economic nor technical sense at the present time to exclude highly qualified assurance service providers from sustainability reporting. According to the CSRD, independent assurance service providers should be accredited by the German Accreditation Body (Deutsche Akkreditierungsstelle). Prerequisites include a suitability test, quality assurance systems and continuous training. Decisive criteria are the independence and impartiality of the providers. Accreditation bodies carry out supervision and quality control of the assessment organisations and thus guarantee a high level of assessment services.
Further information on the "Assessment of sustainability reports" is available in a position paper of TÜV-Verband e.V.
The presentation of the results of the company survey "Sustainability reports in SMEs"
