Commission Delegated Regulation (EU) 2023/2772 of 31 July 2023 supplementing Directive 2013/34/EU of the European Parliament and of the Council as regards sustainability reporting standards

• (b) for financial or in-kind political contributions:
• i. the total monetary value of financial and in-kind political contributions made directly and indirectly by the undertaking aggregated by country or geographical area where relevant, as well as type of recipient/beneficiary; and
• ii. where appropriate, how the monetary value of in-kind contributions is estimated.

• (c) the main topics covered by its lobbying activities and the undertaking’s main positions on these in brief. This shall include explanations on how this interacts with its material impacts, risks and opportunities identified in its materiality assessment per ESRS 2; and

• (d) if the undertaking is registered in the EU Transparency Register or in an equivalent transparency register in a Member State, the name of any such register and its identification number in the register.

• 30.The disclosure shall also include information about the appointment of any members of the administrative, management and supervisory bodies who held a comparable position in public administration (including regulators) in the 2 years preceding such appointment in the current reporting period.

Disclosure Requirement G1-6 – Payment practices

• 31.The undertaking shall provide information on its payment practices, especially with respect to late payments to small and medium enterprises (SMEs).

• 32.The objective of this Disclosure Requirement is to provide insights on the contractual payment terms and on its performance with regard to payment, especially as to how these impact SMEs and specifically with respect to late payments to SMEs.

• 33.The disclosure under paragraph 31 shall include:

- (a) the average time the undertaking takes to pay an invoice from the date when the contractual or statutory term of payment starts to be calculated, in number of days;

• (b) a description of the undertaking’s standard payment terms in number of days by main category of suppliers and the percentage of its payments aligned with these standard terms;

• (c) the number of legal proceedings currently outstanding for late payments; and

- (d) complementary information necessary to provide sufficient context. If the undertaking has used representative sampling to calculate the information required under point (a), it shall state that fact and briefly describe the methodology used.

Appendix A

Application Requirements

This appendix is an integral part of the ESRS G1 Business conduct. It supports the application of the disclosure requirements set out in this standard and has the same authority as the other parts of the Standard.

Impact, risk and opportunity management

Disclosure Requirement G1-1 – Business conduct policies and corporate culture

• AR 1.The undertaking may consider the following aspects when determining its disclosure under paragraph 7:

- (a) the aspects of corporate culture that are taken into consideration and discussed by the administrative, management and supervisory bodies and with which frequency;

• (b) the principal themes that are promoted and communicated as part of the corporate culture;

• (c) how the members of the undertaking’s administrative, management and supervisory bodies provide direction to promote a corporate culture; and

• (d) specific incentives or tools for its own workers to foster and encourage its corporate culture.

Disclosure Requirement G1-2 – Management of relationships with suppliers

• AR 2.For purposes of this standard, management of relationships with the undertaking’s suppliers may include the following:

• (a) how the undertaking’s practices, including activities to avoid or minimise the impacts of disruptions to its supply chain, support its strategy and risk management;

• (b) training of the undertaking’s procurement/supply chain workforce on engagement and dialogue with suppliers as well as incentives of its procurement workforce including whether such incentives refer to price, quality or sustainability factors;

• (c) the screening and evaluation of social and environmental performance of suppliers;

• (d) the inclusion of locally based suppliers in its supply chain and/or suppliers with certification;

- (e) how the undertaking’s practices deal with vulnerable suppliers;

• (f) the undertaking’s targets and actions with regard to communication and management of relationships with suppliers; and

• (g) how the outcomes of these practices are evaluated, including supplier visits, audits or surveys.

• AR 3.'Vulnerable suppliers’ includes suppliers that are exposed to significant economic, environmental and/or social risks.

Disclosure Requirement G1-3 – Prevention and detection of corruption and bribery

• AR 4.‘Functions-at-risk’ means those functions deemed to be at risk of corruption and bribery as a result of its tasks and responsibilities.

• AR 5.Disclosures may include details about the risk assessments and/or mapping, as well as monitoring programmes and/or internal control procedures performed by the undertaking to detect corruption and bribery.

• AR 6.The undertaking’s policies on corruption and bribery may be relevant to specific groups of people, either because they are expected to implement them (for example, the undertaking’s employees, contractors and suppliers), or because they have a direct interest in their implementation (for example, value chain workers, investors). The undertaking may disclose the communication tools and channels (e.g., flyers, newsletters, dedicated websites, social media, face to face interactions, unions and/or workers representatives) to communicate policies to such groups. This may also include the identification and/or removal of potential barriers to dissemination, such as through translation into relevant languages or the use of graphic depictions.

• AR 7.The undertaking may disclose an analysis of its training activities by, for example, region of training or category of own workforce where its programmes differ significantly based on such factors and such information would be useful to users.

• AR 8.The undertaking may present the required information about training using the following table:

- Anti-corruption and bribery training illustrative example

- During the 20XY financial year ABC provided training to its at-risk own workers in terms of its policy (see note x). For those at-risk functions the training is mandatory, but ABC also made available voluntary training for other own workers. Details of its training during the year is as follows:

Administrative, management and supervisory bodies.

Metrics and targets

Disclosure Requirement G1-5 – Political influence and lobbying activities

• AR 9.For purposes of this Standard ‘political contribution’ means financial or in-kind support provided directly to political parties, their elected representatives or persons seeking political office. Financial contributions can include donations, loans, sponsorships, advance payments for services, or the purchase of tickets for fundraising events and other similar practices. In-kind contributions can include advertising, use of facilities, design and printing, donation of equipment, provision of board membership, employment or consultancy work for elected politicians or candidates for office.

• AR 10.‘Indirect political contribution’ refers to those political contributions made through an intermediary organisation such as a lobbyist or charity, or support given to an organisation such as a think tank or trade association linked to or supporting particular political parties or causes.

• AR 11.When determining ‘comparable position’ in this standard, the undertaking shall consider various factors, including level of responsibility and scope of activities undertaken.

• AR 12.The undertaking may provide the following information on its financial or in-kind contributions with regard to its lobbying expenses:

• (a) the total monetary amount of such internal and external expenses; and

• (b) the total amount paid for membership to lobbying associations.

• AR 13.If the undertaking is legally obliged to be a member of a chamber of commerce or other organisation that represents its interests, it may disclose that this is the case.

• AR 14.In meeting the requirement in paragraph 29(c) the undertaking shall consider the alignment between its public statements on its material impacts, risks and opportunities and its lobbying activities.

• AR 15.An example of what such disclosures could look like:

• Political engagement (including lobbying activities) illustrative example

- During the 20XY financial year ABC was involved in activities around the proposed regulation XXX which could have significant negative impacts on its

business model if implemented in the current format. ABC’s considers that while the proposed regulation will realise some improvements to the regulatory regime such as xxx, in its current format the costs relating to xxx will outweigh the benefits. ABC and its peers continue to work with XXX (the regulator) to improve this balance.

• ABC also supported the QRP political party in Country X and EFG party in Country Y as both …. ABC is registered in its local transparency register, i.e., XYZ, and its registration number is 987234.

• Amounts in € thousands.

Disclosure Requirement G1-6 – Payment practices

• AR 16.In some cases, the undertaking’s standard contractual payment terms may differ significantly depending on country or type of supplier. In such cases, information about the standard terms per main categories of suppliers or country or geographical region could be examples of additional contextual information to explain the disclosures in paragraph 33(b).

• AR 17.An example of what the description of standard contract term disclosures in paragraph 33(b) could look like:

- ABC’s standard contract payment terms are payment on receipt of invoice for wholesalers which encompass approximately 80% of its annual invoices by value. It pays for services received within 30 days after receipt of the invoice which are about 5% of its annual invoices. The remainder of its invoices are paid within 60 days of receipt except for those in country X which in accordance with the marketplace standards are paid within 90 days of receipt.

ANNEX II

ACRONYMS AND GLOSSARY OF TERMS

This Annex presents all the acronyms found in the ESRS (Table 1) as well as all terms defined in the ESRS (Table 2).

Table 1

Acronyms

| | |

| --- | --- | | AMS | Automated Measuring Systems | | AQI | Air Quality Indices | | AR | Application Requirements | | AWS | Alliance for Water Stewardship | | BAT | Best Available Technique | | BAT-AEL | Best Available Technique-Associated Emission Level | | BAT-AEPL | Best Available Technique-Associated Environmental Performance Level | | BREFs | Best Available Techniques Reference Documents | | Btu | British Thermal Units | | CapEx | Capital Expenditure | | CBD | Convention for Biological Diversity | | CDDA | Common Database on Designated Areas | | CEN | European Committee for Standardization | | CENELEC | European Committee for Electrotechnical Standardization | | CH4 | Methane | | CICES | Common International Classification of Ecosystem Services | | C02 | Carbon Dioxide | | CRR | Regulation (EU) No 575/2013 of the European Parliament and of the Council [^E0134] (Capital Requirements Regulation) | | DEGURBA | Degree of Urbanisation | | DR BP-1 | Disclosure Requirement - General basis for preparation of the sustainability statements | | DR BP-2 | Disclosure Requirement - Disclosures in relation to specific circumstances | | DR GOV-1 | Disclosure Requirement - The role of the administrative, management and supervisory bodies | | DR GOV-2 | Disclosure Requirement - Information provided to and sustainability matters addressed by the undertaking’s administrative, management and supervisory bodies | | DR GOV-3 | Disclosure Requirement - Integration of sustainability- related performance in incentive schemes | | DR GOV-4 | Disclosure Requirement - Statement on sustainability due diligence | | DR GOV-5 | Disclosure Requirement - Risk management and internal controls over sustainability reporting | | DR SBM-1 | Disclosure Requirement - Market position, strategy, business model(s) and value chain | | DR SBM-2 | Disclosure Requirement - Interests and views of stakeholders | | DR SBM-3 | Disclosure Requirement - Material impacts, risks and opportunities and their interaction with strategy and business model(s) | | DR IRO-1 | Disclosure Requirement - Description of the processes to identify and assess material impacts, risks and opportunities | | DR IRO-2 | Disclosure Requirements in ESRS covered by the undertaking’s sustainability statements | | DNSH | Do No Significant Harm | | DR | Disclosure Requirements | | EBA | European Banking Authority | | EC | European Commission | | EEA | European Economic Area | | EFRAG | European Financial Reporting Advisory Group | | EFRAG SRB | European Financial Reporting Advisory Group Sustainability Reporting Board | | EIA | Environmental Impact Assessment | | EMAS | Eco-Management and Audit Scheme | | EPC | Energy Performance Certificate | | E-PRTR | European Pollutant Release and Transfer Register | | ESA | European Supervisory Authorities | | ESMA | European Securities and Markets Authority | | ESRS | European Sustainability Reporting Standards | | ESRS 1 | European Sustainability Reporting Standard 1 General requirements | | ESRS 2 | European Sustainability Reporting Standard 2 General disclosures | | ESRS E1 | European Sustainability Reporting Standard E1 Climate change | | ESRS E2 | European Sustainability Reporting Standard E2 Pollution | | ESRS E3 | European Sustainability Reporting Standard E3 Water and marine resources | | ESRS E4 | European Sustainability Reporting Standard E4 Biodiversity and ecosystems | | ESRS E5 | European Sustainability Reporting Standard E5 Resource use and circular economy | | ESRS G1 | European Sustainability Reporting Standard G1 Business conduct | | ESRS S1 | European Sustainability Reporting Standard S1 Own workforce | | ESRS S2 | European Sustainability Reporting Standard S2 Workers in the value chain | | ESRS S3 | European Sustainability Reporting Standard S3 Affected communities | | ESRS S4 | European Sustainability Reporting Standard S4 Consumers & end-users | | EU | European Union | | EU ETS | European Union Emissions Trading System | | EWC | European Works Council | | FPIC | Free, Prior and Informed Consent | | FTE | Full-time equivalent | | GAAP | Generally Accepted Accounting Principles | | GHG | Greenhouse Gas | | GJ | Giga-Joules | | GRI | Global Reporting Initiative | | GWP | Global Warming Potential | | HFCs | Hydrofluorocarbons | | IED | Directive 2010/75/EU of the European Parliament and of the Council [^E0135] (Industrial Emissions Directive) | | IFC | International Finance Corporation | | IFRS | International Financial Reporting Standards | | ILO | International Labour Organisation | | IPBES | Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services | | IPCC | Intergovernmental Panel on Climate Change | | ISEAL | International Social and Environmental Accreditation and Labelling Alliance | | ISO | International Organization for Standardization | | ISSB | International Sustainability Standards Board | | ITS | Implementing Technical Standards | | IUCN | International Union for Conservation of Nature | | KBA | Key Biodiversity Areas | | Kg | Kilogram | | lb | Pounds | | LEAP | Locate Evaluate Assess Prepare | | LGBTQI | Lesbian, Gay, Bisexual, Transgender, Queer, Intersex | | MDR | Minimum Disclosure Requirement | | MWh | Mega-Watt-hours | | N2O | Nitrous Oxide | | NACE | Statistical Classification of Economic Activities in the European Community | | NF3 | Nitrogen trifluoride | | NGOs | Non-Governmental Organisations | | NH3 | Ammonia | | NOX | Nitrogen oxides | | NUTS | Nomenclature of Territorial Units of Statistics | | O3 | Ozone | | ODS | Ozone-depleting substance | | OECD | Organisation for Economic Co-operation and Development | | OECM | One Earth Climate Model | | OpEX | Operating Expenditure | | PBTS | Persistent, bioaccumulative and toxic substances | | PCAF | Partnership for Carbon Accounting Financial | | PCFs | Perfluorocarbons | | PM | Particulate Matter | | PMTs | Persistent, Mobile and Toxic Substances | | POPs | Persistent organic pollutants | | REACH | Registration, Evaluation, Authorisation and Restriction of Chemicals | | SBTi | Science Based Targets Initiative | | SBTN | Science Based Targets Network | | SCE | Societas Cooperativa Europaea | | SDA | Sectoral Decarbonisation Approach | | SDGs | Sustainable Development Goals | | SDPI | Sustainable Development Performance Indicator | | SE | Societas Europaea | | SEEA | System of Environmental-Economic Accounting | | SEEA EA | System of Environmental-Economic Accounting Ecosystem Accounting | | SFDR | Regulation (EU) 2019/2088 of the European Parliament and of the Council [^E0136] (Sustainable Finance Disclosures Regulation) | | SOX | Sulphur oxides | | SVHC | Substances of Very High Concern | | TCFD | Task Force on Climate-Related Financial Disclosures | | TNFD | Taskforce on Nature-related Financial Disclosures | | UN | United Nations | | UNEP | United Nations Environment Programme | | UNESCO | United Nations Educational, Scientific and Cultural Organization | | vPvBs | Very persistent and very bioaccumulative substances | | vPvMs | Very persistent and very mobile substances | | WDPA | World Database of Protected Areas | | WRI | World Resources Institute | | WWF | World-Wide Fund for Nature |

[^E0134]: (¹)

Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).

Directive 2010/75/EU of the European Parliament and of the Council of 24 November 2010 on industrial emissions (integrated pollution prevention and control) (OJ L 334, 17.12.2010, p. 17).

Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector (OJ L 317, 9.12.2019, p. 1).

Table 2

Terms defined in the ESRS

This table defines the terms to be used as reference for the preparation of the sustainability statements in accordance with the ESRS.