Shaping Ireland’s response to an evolving ESG regulatory landscape
The business community has a central role to play in driving Ireland’s transition to a more sustainable economy and meeting the country’s ambitious targets set out under the Climate Action Plan by 2030.
While there is a growing recognition of climate risk and the importance of considering sustainability as part of core business strategy, the majority of companies are still in the early stages of this transition and grappling to deal with an ever-evolving regulatory landscape.
Recent regulatory developments driven by the European Commission will be a key driver of change, with an increasing focus on the broad impact of the corporate sector across the environment and society.
This will require strong leadership at the highest levels, with governance and accountability at C-suite and board level essential to moving the dial.
Over the past year, we have activated a range of partnerships to support industry in responding to this challenge, including our founding membership of Chapter Zero Ireland – the Irish chapter of the Climate Governance Initiative.
This valuable network brings together non-executive directors from Ireland’s leading companies to take a collaborative approach to driving the sustainability agenda. In October, we were delighted to host a session on sustainability regulation and reporting, with speakers including Deloitte’s Hollie Keating, DCU’s Professor Aideen O’Dochartaigh and panelists from Dalata and daa.
Alongside our ongoing partnerships with the DCU Centre for Climate and Society and the International Sustainable Finance Centre of Excellence, we will continue to play a leading role in positioning Ireland as a leader in sustainable business.
Taking an integrated approach
At a European level and global level, our sustainability experts are also actively involved in shaping sustainability legislation, allowing us to bring the voice of our clients to this process and expertly guide them through this transition.
Deloitte is a member of several key regulatory bodies, including the European Financial Reporting Advisory Group - which is responsible for developing the European Sustainability Reporting Standards (ESRS) and Taskforce on Nature-Related Financial Disclosures (TNFD), as well as supporting the Sustainable Markets Initiative.
The introduction of the Corporate Sustainability Reporting Directive (CSRD) in 2024 will require businesses to take a broader view of their impact - taking into account both the impact of ESG-related matters on a company and also how the company’s actions will affect people and the environment.
There is also a growing recognition that climate and nature related risks are becoming an imminent threat to business and we expect to see a sharper focus on broader environmental matters with the finalisation of the Taskforce of Nature Related Disclosures (TNFD) in autumn 2023.
In order to support businesses in navigating this complex landscape, we recently established our EMEA Sustainability Regulation Hub to demystify European and international mandatory regulatory requirements, voluntary codes and standards.
This has become a critical source of insight and advice for sustainability regulatory strategy, enabling leaders to respond to new requirements and assess how best to transform business strategies and operating models. Read the 2023 report here.
Utilising tools and technologies to streamline the transition
Our latest research shows that lack of in-house knowledge and skills on ESG reporting is one of the most pressing challenges that CFOs face, with 52% of those surveyed citing this as a barrier to unlocking their ESG strategy.
Deloitte is helping clients with this skills gap, guiding them to better manage sustainability value creation and risk exposure by embedding ESG considerations into core operations.
Our multidisciplinary teams have been working with clients across sectors including food and consumer goods, financial services, and transport, with capabilities spanning across assessment and planning through to implementation and system integration.
One of the key challenges facing these businesses is the significant data and reporting capabilities required, so we have been utilising emerging tools and technologies to streamline this process – recently employing cloud-based platforms to facilitate automated interaction and stakeholder coordination in generating data for EU Taxonomy reporting.
Social factors, or the ‘S’ in ESG, also continue to be a growing priority. In Ireland, 2022 saw the first round of reporting for companies under the Gender Pay Gap Information Act 2021. Gender Pay Gap reporting obligations apply to any employing entity with 250 or more employees. This threshold will reduce to 150 or more in 2024 and 50 or more in 2025. We’re supporting our clients through every stage of the Gender Pay Gap reporting journey, from understanding the requirements under the Regulations, calculating their Gender Pay Gap metrics, preparing their company narrative to explain their metrics and plans to address reducing the gap (where present) over time and embedding gender and equal pay strategies to create a more inclusive work environment.
We don’t just stop at assisting clients with reporting, our multidisciplinary team of specialists supports clients drive the transformation needed in their businesses and supply chains to accelerate the pace of change needed to make an impact.
Key contacts
Head of Sustainability