Mr Dombrovskis said that later this year he would present a renewed sustainable finance strategy, which would include a revision of the Non-Financial Reporting Directive. This would require companies to increase disclosure on their sustainable activities and give adequate reliable information on sustainability risks and opportunities. However, he said, not every detail can – or should – be fixed in law. There was also a need for clear reporting standards for companies to apply.

Mr Dombrovskis went on to say: “So today, I can tell you that the European Commission will support a process to develop European non-financial reporting standards. I will soon invite the European Financial Reporting Advisory Group [EFRAG] to begin preparatory work for these standards as quickly as possible. The many overlapping international reporting standards and set-ups confuse companies and investors. They also find it expensive. The EU is well placed to address this situation – and show leadership in building consensus for a set of standards that can be widely accepted.”

Mr Dombrovskis conceded that the European Commission cannot do this alone. Therefore, he stated, the best and most widely accepted elements of what exists today will be the starting point and expert assistance from those organisations and individuals who can best contribute to the process will be used.

Read the full text of Mr Dombrovskis’ speech