### a. whereas the covid-19 pandemic has had a devastating effect on the labour and social status of young people in europe , with employment rates falling , a considerable decrease in personal income12 and a higher risk of poverty and exclusion; whereas immediate action is needed to secure the future of young people; ### a. whereas the covid-19 pandemic has had a devastating effect on the labour , employment and social status of young people in europe , with employment rates falling , a considerable decrease in personal income12 and a higher risk of poverty and social exclusion; whereas immediate action is needed to secure the future and well-being of young people;


### b. whereas young people are the basis for sustainable economic and social prosperity for europe and are a key priority for the eu as affirmed by the european youth strategy and the european youth guarantee , and therefore warrant priority measures for their protection , guidance and inclusion; ### b. whereas young people are the basis for sustainable economic and social prosperity for europe and are a key priority for the eu as affirmed by the european youth strategy and the european youth guarantee , and therefore warrant priority measures for their support protection , guidance , inclusion and creation of opportunities;


### d. whereas the mental health of young people has worsened significantly during the pandemic , with problems related to mental health doubling in several member states; whereas nine million adolescents in europe (aged 10 to 19) are living with mental health disorders , with anxiety and depression accounting for more than half of cases; ### d. whereas the mental health of young people has worsened significantly during the pandemic , with problems related to mental health doubling in several member states compared to the pre-crisis level; whereas 64 % of young people in the age group 18–34 years were at risk of depression in spring 2021 , partly as a consequence of their lack of employment , financial and educational prospects in the longer run; whereas nine million adolescents in europe (aged 10 to 19) are living with mental health disorders , with anxiety and depression accounting for more than half of cases 1a;


### f. whereas the labour and social inclusion of young people refers to their access to adequate housing and nutrition , proper healthcare and prevention services , programmes for skills development , job opportunities and lifelong learning; ### f. whereas the labour and social inclusion of young people refers to their equal access to decent and affordable housing and adequate nutrition , quality healthcare and prevention services , programmes for skills development , quality traineeships and job opportunities and lifelong learning;


### g. whereas investments in young people , particularly social impact investments , are known to produce effective returns on the funds invested , and therefore new tools and new mechanisms are needed; ### deleted


### h. whereas existing programmes such as the youth employment support , the european youth dialogue and the european solidarity corps , and new proposals such as aim , learn , master , achieve (alma) , will tackle youth challenges in 2022; ### h. whereas existing programmes such as the reinforced youth guarantee , the youth employment support , the european youth dialogue and the european solidarity corps , and new proposals such as aim , learn , master , achieve (alma) , should be used to tackle youth challenges in 2022;


### i. whereas the constant development of new horizontal skills among young people , such as digital skills , as well as the development of skills with huge economic potential , such as green or entrepreneurial skills , is key for a healthy european labour market; ### i. whereas the constant development of new horizontal skills among young people , such as digital skills , as well as the development of skills with economic potential , such as green or entrepreneurial skills , is key for a healthy european labour market;


### k. whereas discrimination against young people in general remains an issue in europe , with young women , and young people with disabilities or different ethnic backgrounds being at a much higher risk of unemployment , in-work poverty and social exclusion; ### k. whereas discrimination against young people in general remains an issue in europe , with young women , young lgbtqia+ and young people with disabilities or different ethnic backgrounds being at a much higher risk of unemployment , poverty and social exclusion , including in-work poverty;


### l. whereas young people in europe and their representatives and organisations are active in producing policy recommendations with solutions for improving labour and social inclusion and must be considered essential partners in the implementation of the eyy and beyond; ### l. whereas young people in europe and their representatives and organisations are active in producing policy recommendations with solutions for improving labour and social inclusion including through their engagement as part of the conference on the future of europe and must be considered essential partners in the co-creation , implementation and evaluation of the eyy and beyond;


### 1. welcomes the fact that president von der leyen designated 2022 as the eyy; considers that 2022 should bring a revamp of the european youth strategy through ambitious new policy proposals to combat the effects of covid-19 on young people in europe; ### 1. welcomes the fact that president von der leyen designated 2022 as the eyy; considers that 2022 should provide an additional impetus to the ambitious implementation of the european youth strategy through ambitious new policy proposals and the concrete implementation of existing tools such as the reinforced youth guarantee to combat the effects of covid-19 on young people in europe; considers further that the eyy should contribute to the full implementation of principles 1 and 3 of the european pillar of social rights;


### 3. stresses the vital role that young people must play in shaping employment and social policies in europe; welcomes the eu youth dialogue and the youth work that brings the eu closer to young people; encourages the promotion of the co-management principle in the development of youth policies; calls on the commission to recognise the positive impact of the third sector , including youth organisations , and the non-formal and informal learning opportunities that they provide through volunteering opportunities; ### 3. stresses the vital role that young people must play in shaping employment and social policies in europe; welcomes the eu youth dialogue and the youth work that brings the eu closer to young people; encourages the promotion of the co-management principle in the development of youth policies; calls on the commission to recognise the positive impact of the third sector , including youth organisations , and the non-formal and informal learning opportunities that they provide through but not only volunteering opportunities;


### 5. calls on the member states to ensure complementarity between measures under the rrf , other eu programmes and national budget allocations; recalls the opportunity provided by the investeu social investment and skills window to generate social impact investments; encourages the use of social impact bonds and social outcome contracts aimed at young people while also involving the private sector; ### 5. calls on the member states to ensure complementarity between measures under the rrf , other eu programmes and national budget allocations including between european youth guarantee and european child guarantee; recalls the opportunity provided by the investeu social investment and skills window to generate social impact investments; encourages the use of social impact bonds and social outcome contracts aimed at young people while also involving the private sector;


### 6. calls for reinforced measures , through the esf+ , to promote employment through active interventions for labour market integration and the creation of sustainable entry-level positions; calls on the member states to present updated implementation plans for a reinforced youth guarantee; calls on the commission to provide incentives for companies to play an active role in the reinforced youth guarantee; ### 6. calls for reinforced measures , through the esf+ , to promote employment through active interventions for labour market integration and the creation of sustainable and quality entry-level positions; calls on the european commission to request updated implementation plans from member states for the reinforced youth guarantee; calls on the commission to provide incentives for companies to play an active role in the reinforced youth guarantee; calls on the european commission and member states to introduce a framework with clear and binding quality standards for all offers provided under the youth guarantee to promote positive and sustainable outcomes for young people , and successful transition to the labour market;


### 7. invites the commission to set up a permanent eu committee for the implementation of the reinforced youth guarantee , bringing together relevant stakeholders to facilitate coordination and the exchange of best practices between eu and national authorities , together with civic partners and youth organisations; ### 7. recalls that partnerships with stakeholders are a key element of the reinforced youth guarantee; stresses however that no formal body or mechanism currently exists at eu level for their participation in the monitoring and implementation of the youth guarantee; invites the commission to set up a permanent eu committee for the implementation of the reinforced youth guarantee , bringing together relevant stakeholders to facilitate coordination and the exchange of best practices between eu and national authorities , together with social partners , civic partners and youth organisations;


### 9. calls on the member states to facilitate access for young people to paid traineeships and apprenticeships; calls for the reinforcement of monitoring schemes , ensuring that young people receive adequate and quality opportunities for upskilling and new qualifications or credentials , avoiding unfair practices such as exploitative or unpaid internships; ### 9. calls on the member states to guarantee access for young people to paid quality traineeships and apprenticeships; calls for the reinforcement of monitoring schemes , ensuring that young people receive adequate and quality first working experience , opportunities for upskilling and new qualifications or credentials; condemns the practice of unpaid internships as a form of exploitation of young workers and a violation of their rights; calls on the commission to put forward a legal framework for an effective and enforceable ban on such unpaid internships , traineeships and apprenticeships;


### 10. calls on the commission to ensure that the new alma initiative assists young people , in particular young people aged 15 to 19 not in employment , education or training (neets) , in finding temporary work experience in another member state and to ensure that virtual learning and cooperation remain combined with physical mobility under esf+; ### 10. calls on the commission to ensure that the new alma initiative assists young people , in finding temporary quality work experience that respects the quality standards upholding young people’s labour rights , including a decent salary and access to social protection and does not become yet another instrument creating precarious employment conditions for young people;


### 11. underlines that digital skills are essential for all industries and invites the commission to develop permanent , certified and free access for young people to online courses for digital skills and literacy in all eu languages in partnership with private companies; calls for the creation of exchange spaces on e-learning and e-teaching; insists that the eu and the member states develop more programmes such as etwinning and the electronic platform for adult learning in europe; ### 11. underlines that digital skills are essential skills in 21st century and invites the commission to develop permanent , certified and free access for young people to online courses for digital skills and literacy in all eu languages; calls for the creation of exchange spaces on e-learning and e-teaching; insists that the eu and the member states develop more programmes such as etwinning and the electronic platform for adult learning in europe;


### 12. stresses the importance of creating incentives for green skills development and employment opportunities in a climate-neutral , energy efficient and circular economy , especially in the regions most impacted by the green transition; ### 12. stresses the importance of green skills development and employment opportunities in a climate-neutral , energy efficient and circular economy , especially in the regions most impacted by the green transition;


### 14. deplores the insufficient correlation between reforms and investments in education and training with measures that ensure labour market inclusion for young people , particularly neets; encourages flexible , inclusive , accessible and open learning paths through individual learning accounts and micro-credentials for young people , youth workers , trainers and professionals; ### 14. deplores the insufficient correlation between reforms and investments in education and training with measures that ensure labour market inclusion for young people , particularly neets; encourages flexible , inclusive , accessible and open learning paths through individual learning accounts and micro-credentials for young people , youth workers , trainers and professionals , including through skills and competencies gained through non-formal education and informal learning;


### 18. recalls the fact that young women are at increased risk of workplace discrimination13 , unemployment , being single-parent families and being long-term caregivers , which often excludes them from the workforce or keeps them below the poverty line; recommends that the council and commission include dedicated targets for assistance and tailored aid schemes for young women at risk in all initiatives from 2022 onwards; calls on the commission to work with the member states to integrate child guarantee national action plans with labour integration measures at national level to support young single parents; ### 18. recalls the fact that young women are at increased risk of workplace discrimination13 , unemployment , being single-parent families and being long-term caregivers , which often excludes them from the workforce or keeps them below the poverty line; calls on the council and commission to include dedicated targets for assistance and tailored aid schemes for young women at risk in all initiatives from 2022 onwards; calls on the commission to work with the member states to integrate child guarantee national action plans with labour integration measures at national level to support young single parents;


### 19. reiterates the importance of access to housing and tailored social services for vulnerable young people; asks the commission to work with the member states on housing first for youth programmes complemented by employment , social and health support services; stresses the importance of private and public investment in social infrastructure for young people; ### 19. reiterates the importance of access to decent and affordable housing and tailored social services for young people; asks the commission to work with the member states on housing first for youth programmes complemented by employment , social and health support services; stresses the importance of private and public investment in social infrastructure for young people;


### 20. notes with concern the worsening of conditions for many vulnerable young people already suffering from precarity and social exclusion such as young roma , young people with disabilities and young migrants; ### 20. notes with concern the worsening of conditions for many vulnerable young people already suffering from precarity and social exclusion such as young lgbtqia+ , young roma , young people with disabilities and young migrants; calls on member states to prioritise outreach to vulnerable groups in the framework of the youth guarantee , esf+ and the recovery and resilience facility;


### (1) in its communication on the european green deal adopted on 11 december 201930 , the european commission made a commitment to review the provisions concerning non-financial reporting of directive 2013/34/eu of the european parliament and of the commission.31 the european green deal is the european union’s new growth strategy. it aims to transform the union into a modern , resource-efficient and competitive economy with no net emissions of greenhouse gases by 2050. it also aims to protect , conserve and enhance the union's natural capital , and protect the health and well-being of citizens from environment-related risks and impacts. the european green deal aims at decoupling economic growth from resource use , and ensuring that all regions and citizens of the union participate in a socially just transition to a sustainable economic system. it will contribute to the objective of building an economy that works for the people , strengthening the eu’s social market economy , helping to ensure that it is future-ready and that it delivers stability , jobs , growth and investment. these goals are especially important considering the socio-economic damage caused by the covid-19 pandemic and the need for a sustainable , inclusive and fair recovery. in its proposal of 4 march 2020 for a european climate law , the european commission proposed to make the objective of climate neutrality by 2050 binding in the union.32 ### (1) in its communication on the european green deal adopted on 11 december 201930 , the european commission made a commitment to review the provisions concerning non-financial reporting of directive 2013/34/eu of the european parliament and of the commission.31 the european green deal is the european union’s new growth strategy. it aims to transform the union into a modern , resource-efficient and competitive economy with no net emissions of greenhouse gases by 2050. it also aims to protect , conserve and enhance the union's natural capital , and protect the health and well-being of citizens from environment-related risks and impacts. the european green deal aims at decoupling economic growth from resource use , and ensuring that all regions and citizens of the union participate in a socially just transition to a sustainable economic system. it will contribute to the objective of building an economy that works for the people , strengthening the eu’s social market economy , helping to ensure that it is future-ready and that it delivers stability , quality jobs , growth and investment. these goals are especially important considering the socio-economic damage caused by the covid-19 pandemic and the need for a sustainable , inclusive and fair recovery. in its proposal of 4 march 2020 for a european climate law , the european commission proposed to make the objective of climate neutrality by 2050 binding in the union.32


### (7) many stakeholders consider the term ‘non-financial’ to be inaccurate , in particular because it implies that the information in question has no financial relevance. increasingly , however , the information in question does have financial relevance. many organisations , initiatives and practitioners in this field refer to ‘sustainability’ information. it is therefore preferable to use the term ‘sustainability information’ in place of ‘non-financial information’. directive 2013/34/eu should therefore be amended to take account of this change in terminology. ### (7) many stakeholders consider the term ‘non-financial’ to be inaccurate , in particular because it implies that the information in question has no financial relevance. increasingly , however , the information in question does have financial relevance. many organisations , initiatives and practitioners in this field refer to ‘sustainability’ information. it is therefore preferable to use the term ‘sustainability information’ in place of ‘non-financial information’. directive 2013/34/eu should therefore be amended to take account of this change in terminology and to align sustainability reporting standards with financial reporting standards.


### (8) the ultimate beneficiaries of better sustainability reporting by undertakings are individual citizens and savers. savers who want to invest sustainably will have the opportunity to do so , while all citizens should benefit from a stable , sustainable and inclusive economic system. to realise these benefits , the sustainability information disclosed in undertaking’s annual reports first has to reach two primary groups (‘users’). the first group of users consists of investors , including asset managers , who want to better understand the risks and opportunities that sustainability issues pose to their investments and the impacts of those investments on people and the environment. the second group of users consists of organisations , including non-governmental organisations and social partners , that wish to better hold undertakings to account for their impacts on people and the environment. other stakeholders may also make use of sustainability information disclosed in annual reports. the business partners of undertakings , including customers , may rely on this information to understand , and where necessary report on , the sustainability risks and impacts through their own value chains. policy makers and environmental agencies may use such information , in particular on an aggregate basis , to monitor environmental and social trends , to contribute to environmental accounts , and to inform public policy. few individual citizens and consumers directly consult undertaking’s reports , but they may use such information indirectly such as when considering the advice or opinions of financial advisers or non-governmental organisations. many investors and asset managers purchase sustainability information from third party data providers , who collect information from various sources , including public corporate reports. ### (8) the ultimate beneficiaries of better sustainability reporting by undertakings are individual citizens and savers. savers who want to invest sustainably will have the opportunity to do so , while all citizens should benefit from a stable , sustainable , transparent and inclusive economic system. to realise these benefits , the sustainability information disclosed in undertaking’s annual reports first has to reach two primary groups (‘users’). the first group of users consists of investors , including asset managers , who want to better understand the risks and opportunities that sustainability issues pose to their reputation and investments and the impacts of those investments on people , in particular workers and local communities , and the environment. the second group of users consists of organisations , including non-governmental organisations and social partners , that wish to better hold undertakings to account for their impacts on people , in particular workers and local communities , and the environment. other stakeholders may also make use of sustainability information disclosed in annual reports. the business partners of undertakings , including customers , may rely on this information to understand , and where necessary report on , the sustainability risks and impacts through their own value chains. policy makers , social partners , environmental agencies and non-governmental organisations may use such information , in particular on an aggregate basis , to monitor environmental and social trends , to contribute to environmental accounts and social progress , and to inform public policy. few individual citizens and consumers directly consult undertaking’s reports , but they may use such information indirectly such as when considering the advice or opinions of financial advisers or non-governmental organisations. many investors and asset managers purchase sustainability information from third party data providers , who collect information from various sources , including public corporate reports.


### (8) the ultimate beneficiaries of better sustainability reporting by undertakings are individual citizens and savers. savers who want to invest sustainably will have the opportunity to do so , while all citizens should benefit from a stable , sustainable and inclusive economic system. to realise these benefits , the sustainability information disclosed in undertaking’s annual reports first has to reach two primary groups (‘users’). the first group of users consists of investors , including asset managers , who want to better understand the risks and opportunities that sustainability issues pose to their investments and the impacts of those investments on people and the environment. the second group of users consists of organisations , including non-governmental organisations and social partners , that wish to better hold undertakings to account for their impacts on people and the environment. other stakeholders may also make use of sustainability information disclosed in annual reports. the business partners of undertakings , including customers , may rely on this information to understand , and where necessary report on , the sustainability risks and impacts through their own value chains. policy makers and environmental agencies may use such information , in particular on an aggregate basis , to monitor environmental and social trends , to contribute to environmental accounts , and to inform public policy. few individual citizens and consumers directly consult undertaking’s reports , but they may use such information indirectly such as when considering the advice or opinions of financial advisers or non-governmental organisations. many investors and asset managers purchase sustainability information from third party data providers , who collect information from various sources , including public corporate reports. ### (8) the ultimate beneficiaries of better sustainability reporting by undertakings must be individual citizens and savers. savers who want to invest sustainably must have the opportunity to do so , while all citizens must benefit from a stable , sustainable and inclusive economic system. to realise these benefits , the sustainability information disclosed in undertaking’s annual reports first has to reach two primary groups (‘users’). the first group of users consists of investors , including asset managers , who want to better understand the risks and opportunities that sustainability issues pose to their investments and the impacts of those investments on people and the environment. the second group of users consists of organisations , including non-governmental organisations , civil society and social partners , that wish to better hold undertakings to account for their impacts on people and the environment. other stakeholders may also make use of sustainability information disclosed in annual reports. the business partners of undertakings , including customers , may rely on this information to understand , and where necessary report on , the sustainability risks and impacts through their own value chains. policy makers and environmental agencies may use such information , in particular on an aggregate basis , to monitor environmental and social trends , to contribute to environmental accounts , and to inform public policy. few individual citizens and consumers directly consult undertaking’s reports , but they may use such information indirectly such as when considering the advice or opinions of financial advisers or non-governmental organisations. many investors and asset managers purchase sustainability information from third party data providers , who collect information from various sources , including public corporate reports. there is an urgent need to make this data available at a reasonable cost.


### (8) the ultimate beneficiaries of better sustainability reporting by undertakings are individual citizens and savers. savers who want to invest sustainably will have the opportunity to do so , while all citizens should benefit from a stable , sustainable and inclusive economic system. to realise these benefits , the sustainability information disclosed in undertaking’s annual reports first has to reach two primary groups (‘users’). the first group of users consists of investors , including asset managers , who want to better understand the risks and opportunities that sustainability issues pose to their investments and the impacts of those investments on people and the environment. the second group of users consists of organisations , including non-governmental organisations and social partners , that wish to better hold undertakings to account for their impacts on people and the environment. other stakeholders may also make use of sustainability information disclosed in annual reports. the business partners of undertakings , including customers , may rely on this information to understand , and where necessary report on , the sustainability risks and impacts through their own value chains. policy makers and environmental agencies may use such information , in particular on an aggregate basis , to monitor environmental and social trends , to contribute to environmental accounts , and to inform public policy. few individual citizens and consumers directly consult undertaking’s reports , but they may use such information indirectly such as when considering the advice or opinions of financial advisers or non-governmental organisations. many investors and asset managers purchase sustainability information from third party data providers , who collect information from various sources , including public corporate reports. ### (8) the ultimate beneficiaries of better sustainability reporting by undertakings are individual citizens and savers. savers who want to invest sustainably will have the opportunity to do so , while all citizens should benefit from a stable , sustainable and inclusive economic system. to realise these benefits , the sustainability information disclosed in undertaking’s annual reports first has to reach two primary groups (‘users’). the first group of users consists of investors , including asset managers , who want to better understand the risks and opportunities that sustainability issues pose to their investments and the impacts of those investments on people and the environment. the second group of users consists of organisations , including non-governmental organisations and social partners , that wish to better hold undertakings to account for their impacts on people and the environment , or wish to exchange with undertakings during the elaboration of those reports. other stakeholders may also make use of sustainability information disclosed in annual reports. the business partners of undertakings , including customers , may rely on this information to understand , and where necessary report on , the sustainability risks and impacts through their own value chains. policy makers and environmental agencies may use such information , in particular on an aggregate basis , to monitor environmental and social trends , to contribute to environmental accounts , and to inform public policy. few individual citizens and consumers directly consult undertaking’s reports , but they may use such information indirectly such as when considering the advice or opinions of financial advisers or non-governmental organisations. many investors and asset managers purchase sustainability information from third party data providers , who collect information from various sources , including public corporate reports.


### (9) there has been a very significant increase in demand for corporate sustainability information in recent years , especially on the part of the investment community. that increase in demand is driven by the changing nature of risks to undertakings and growing investor awareness of the financial implications of these risks. that is especially the case for climate-related financial risks. awareness of the risks to undertakings and to investments resulting from other environmental issues and from social issues , including health issues , is also growing. the increase in demand for sustainability information is also driven by the growth in investment products that explicitly seek to meet certain sustainability standards or achieve certain sustainability objectives. part of that increase is the logical consequence of previously adopted union legislation , notably regulation (eu) 2019/2088 and regulation (eu) 2020/852. some of the increase would have happened in any case , due to fast-changing citizen awareness , consumer preferences and market practices. the covid-19 pandemic will further accelerate the increase in users’ information needs , in particular as it has exposed the vulnerabilities of workers and of undertaking’s value chains. information on environmental impacts is also relevant in the context of mitigating future pandemics with human disturbance of ecosystems increasingly linked to the occurrence and spread of diseases. ### (9) there has been a very significant increase in demand for corporate sustainability information in recent years , especially on the part of the investment community. that increase in demand is driven by the changing nature of risks to undertakings and growing investor awareness of the financial and reputational implications of these risks. that is especially the case for climate-related financial risks. awareness of the risks to undertakings and to investments resulting from other environmental issues and from social issues , including child and forced labour , discrimination and health issues , is also growing. the increase in demand for sustainability information is also driven by the growth in investment products that explicitly seek to meet certain sustainability standards or achieve certain sustainability objectives. part of that increase is the logical consequence of previously adopted union legislation , notably regulation (eu) 2019/2088 and regulation (eu) 2020/852. some of the increase would have happened in any case , due to fast-changing citizen awareness , consumer preferences and market practices. the covid-19 pandemic will further accelerate the increase in users’ information needs , in particular as it has exposed the vulnerabilities of workers , particularly women and informal workers , and of undertaking’s due diligence along the supply and value chains. information on environmental impacts is also relevant in the context of mitigating future pandemics with human disturbance of ecosystems increasingly linked to the occurrence and spread of diseases.


### (12) in the absence of policy action , the gap between users’ information needs and the sustainability information reported by undertakings is expected to grow. this gap has significant negative consequences. investors are unable to take sufficient account of sustainability-related risks and opportunities in their investment decisions. the aggregation of multiple investment decisions that do not take adequate account of sustainability-related risks has the potential to create systemic risks that threaten financial stability. the european central bank and international organisations such as the financial stability board have drawn attention to those systemic risks , in particular in the case of climate. investors are also less able to channel financial resources to undertakings and economic activities that address and do not exacerbate social and environmental problems , which undermines the objectives of the european green deal and the action plan on financing sustainable growth. non-governmental organisations , social partners , communities affected by undertakings’ activities , and other stakeholders are less able to hold undertakings accountable for their impacts on people and the environment. this creates an accountability deficit , and may contribute to lower levels of citizen trust in businesses , which in turn may have negative impacts on the efficient functioning of the social market economy. the lack of generally accepted metrics and methods for measuring , valuing , and managing sustainability-related risks is also an obstacle to the efforts of undertakings to ensure that their business models and activities are sustainable. ### (12) in the absence of policy action , the gap between users’ information needs and the sustainability information reported by undertakings is expected to grow. this gap has significant negative consequences. investors are unable to take sufficient account of sustainability-related risks and opportunities in their investment decisions. the aggregation of multiple investment decisions that do not take adequate account of sustainability-related risks has the potential to create systemic risks that threaten financial stability. the european central bank and international organisations such as the financial stability board have drawn attention to those systemic risks , in particular in the case of climate. investors are also less able to channel financial resources to undertakings and economic activities that address and do not exacerbate social and environmental problems , which undermines the objectives of the european green deal and the action plan on financing sustainable growth. non-governmental organisations , social partners , communities affected by undertakings’ activities , and other stakeholders are less able to hold undertakings accountable for their impacts on people and the environment. this creates an accountability deficit , and may contribute to lower levels of citizen trust in businesses , which in turn may have negative impacts on the efficient functioning of the social market economy. the lack of generally accepted metrics and methods for measuring , valuing , and managing sustainability-related risks is also an obstacle to the efforts of undertakings to ensure that their business models and activities are sustainable and for trade unions to engage in sustainability matters.


### (15) articles 19a and 29a of directive 2013/34/eu apply to large undertakings that are public-interest entities with an average number of employees in excess of 500 , and to public-interest entities that are parent undertakings of a large group with an average number of employees in excess of 500 on a consolidated basis , respectively. in view of the growth of users’ needs for sustainability information , additional categories of undertakings should be required to report such information. it is therefore appropriate to require all large undertakings and all undertakings listed on regulated markets , except micro undertakings , to report detailed sustainability information. in addition , all undertakings that are parent undertakings of large groups should prepare sustainability reporting at group level. ### (15) articles 19a and 29a of directive 2013/34/eu apply to large undertakings that are public-interest entities with an average number of employees in excess of 500 , and to public-interest entities that are parent undertakings of a large group with an average number of employees in excess of 500 on a consolidated basis , respectively. in view of the growth of users’ needs for sustainability information , additional categories of undertakings should be required to report such information. it is therefore appropriate to require all undertakings to report detailed sustainability information. in addition , all undertakings that are parent undertakings of large groups should prepare sustainability reporting at group level based on individual reports by subsidiary undertakings.


### (15) articles 19a and 29a of directive 2013/34/eu apply to large undertakings that are public-interest entities with an average number of employees in excess of 500 , and to public-interest entities that are parent undertakings of a large group with an average number of employees in excess of 500 on a consolidated basis , respectively. in view of the growth of users’ needs for sustainability information , additional categories of undertakings should be required to report such information. it is therefore appropriate to require all large undertakings and all undertakings listed on regulated markets , except micro undertakings , to report detailed sustainability information. in addition , all undertakings that are parent undertakings of large groups should prepare sustainability reporting at group level. ### (15) articles 19a and 29a of directive 2013/34/eu apply to large undertakings that are public-interest entities with an average number of employees in excess of 500 , and to public-interest entities that are parent undertakings of a large group with an average number of employees in excess of 500 on a consolidated basis , respectively. in view of the growth of users’ needs for sustainability information , additional categories of undertakings should be required to report such information. it is therefore appropriate to require all large undertakings and all undertakings listed on regulated markets , and small and medium-sized undertakings operating in high-risk economic sectors , to report detailed sustainability information.


### (16) the requirement that also large non-listed undertakings should disclose information on sustainability matters is mainly driven by concerns about the impacts and accountability of such undertakings , including through their value chain. in this respect , all large undertakings should be subject to the same requirements to report sustainability information publicly. in addition , financial market participants also need information from those large non-listed undertakings. ### (16) the requirement that also large non-listed undertakings should disclose information on sustainability matters is mainly driven by concerns about the impacts and accountability of such undertakings , including through their supply and value chain. in this respect , all undertakings should be subject to the same requirements to report sustainability information publicly to ensure a level playing field. in addition , financial market participants also need information from non-listed undertakings.


### (16) the requirement that also large non-listed undertakings should disclose information on sustainability matters is mainly driven by concerns about the impacts and accountability of such undertakings , including through their value chain. in this respect , all large undertakings should be subject to the same requirements to report sustainability information publicly. in addition , financial market participants also need information from those large non-listed undertakings. ### (16) the requirement that also large non-listed undertakings , and small and medium-sized undertakings operating in high-risk economic sectors , should disclose information on sustainability matters is mainly driven by concerns about the impacts and accountability of such undertakings , including through their value chain. in this respect , all large undertakings , and small and medium-sized undertakings operating in high-risk economic sectors , should be subject to the same requirements to report sustainability information publicly. in addition , financial market participants also need information from those large non-listed undertakings.


### (16) the requirement that also large non-listed undertakings should disclose information on sustainability matters is mainly driven by concerns about the impacts and accountability of such undertakings , including through their value chain. in this respect , all large undertakings should be subject to the same requirements to report sustainability information publicly. in addition , financial market participants also need information from those large non-listed undertakings. ### (16) the requirement that also large non-listed undertakings and small and medium-sized undertakings operating in high-risk economic sectors should disclose information on sustainability matters is mainly driven by concerns about the impacts and accountability of such undertakings , including through their value chain. in this respect , all large undertakings , and small and medium-sized undertakings operating in high-risk economic sectors should be subject to the same requirements to report sustainability information publicly. in addition , financial market participants also need information from those large non-listed undertakings.


### (18) considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (smes) listed on regulated markets comprise a significant proportion of all listed undertakings in the union , in order to ensure investor protection it is appropriate to require that also those smes disclose information on sustainability matters. the introduction of this requirement will help to ensure that financial market participants can include smaller listed undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. it will therefore help to protect and enhance the access of smaller listed undertakings to financial capital , and avoid discrimination against such undertakings on the part of financial market participants. the introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in regulation (eu) 2019/2088. smes listed on regulated markets should , however , be provided with sufficient time to prepare for the application of the requirement to report sustainability information , due to their smaller size and more limited resources , and taking account of the difficult economic circumstances created by the covid-19 pandemic. they should also be given the possibility to report according to standards that are proportionate to the capacities and resources of smes. non-listed smes can also choose to use these proportionate standards on a voluntary basis. the sme standards will set a reference for undertakings that are within the scope of the directive regarding the level of sustainability information that they could reasonably request from sme suppliers and clients in their value chains. ### (18) considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (smes) comprise a significant proportion of all undertakings in the union with sme enterprises making up 99 per cent of all enterprises in the eu2a , in order to ensure investor protection as well as due diligence with regard to the environment and human rights it is appropriate to require that also smes disclose information on sustainability matters. the introduction of this requirement will help to ensure that financial market participants can include smaller undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. it will therefore help to protect and enhance the access of smaller undertakings to financial capital , avoid discrimination against such undertakings on the part of financial market participants and will ensure a level playing field. the introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in regulation (eu) 2019/2088. smes should , however , be provided with sufficient time to prepare for the application of the requirement to report sustainability information , due to their smaller size and more limited resources. they should also be given the possibility to report according to standards that are proportionate to the capacities and resources of smes. the sme standards will set a reference for undertakings that are within the scope of the directive regarding the level of sustainability information that they could reasonably request from sme suppliers and clients in their supply and value chains.


### (18) considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (smes) listed on regulated markets comprise a significant proportion of all listed undertakings in the union , in order to ensure investor protection it is appropriate to require that also those smes disclose information on sustainability matters. the introduction of this requirement will help to ensure that financial market participants can include smaller listed undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. it will therefore help to protect and enhance the access of smaller listed undertakings to financial capital , and avoid discrimination against such undertakings on the part of financial market participants. the introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in regulation (eu) 2019/2088. smes listed on regulated markets should , however , be provided with sufficient time to prepare for the application of the requirement to report sustainability information , due to their smaller size and more limited resources , and taking account of the difficult economic circumstances created by the covid-19 pandemic. they should also be given the possibility to report according to standards that are proportionate to the capacities and resources of smes. non-listed smes can also choose to use these proportionate standards on a voluntary basis. the sme standards will set a reference for undertakings that are within the scope of the directive regarding the level of sustainability information that they could reasonably request from sme suppliers and clients in their value chains. ### (18) considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (smes) listed on regulated markets comprise a significant proportion of all listed undertakings in the union , in order to ensure investor protection it is appropriate to require that also those smes disclose information on sustainability matters. the introduction of this requirement will help to ensure that financial market participants can include smaller listed undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. it will therefore help to protect and enhance the access of smaller listed undertakings to financial capital , and avoid discrimination against such undertakings on the part of financial market participants. the introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in regulation (eu) 2019/2088. smes should be given the possibility to report according to standards that are proportionate to the capacities and resources of smes. there must also be a timeline set for non-listed smes to apply these proportionate standards. the sme standards will set a reference for undertakings that are within the scope of the directive regarding the level of sustainability information that they could reasonably request from sme suppliers and clients in their value chains.


### (18) considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (smes) listed on regulated markets comprise a significant proportion of all listed undertakings in the union , in order to ensure investor protection it is appropriate to require that also those smes disclose information on sustainability matters. the introduction of this requirement will help to ensure that financial market participants can include smaller listed undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. it will therefore help to protect and enhance the access of smaller listed undertakings to financial capital , and avoid discrimination against such undertakings on the part of financial market participants. the introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in regulation (eu) 2019/2088. smes listed on regulated markets should , however , be provided with sufficient time to prepare for the application of the requirement to report sustainability information , due to their smaller size and more limited resources , and taking account of the difficult economic circumstances created by the covid-19 pandemic. they should also be given the possibility to report according to standards that are proportionate to the capacities and resources of smes. non-listed smes can also choose to use these proportionate standards on a voluntary basis. the sme standards will set a reference for undertakings that are within the scope of the directive regarding the level of sustainability information that they could reasonably request from sme suppliers and clients in their value chains. ### (18) considering the growing relevance of sustainability-related risks and taking into account that small and medium-sized enterprises (smes) listed on regulated markets comprise a significant proportion of all listed undertakings in the union , in order to ensure investor protection it is appropriate to require that also those smes disclose information on sustainability matters. the introduction of this requirement will help to ensure that financial market participants can include smaller listed undertakings in investment portfolios on the basis that they report the sustainability information that financial market participants need. it will therefore help to protect and enhance the access of smaller listed undertakings to financial capital , and avoid discrimination against such undertakings on the part of financial market participants. the introduction of this requirement is also necessary to ensure that financial market participants have the information they need from investee undertakings to be able to comply with their own sustainability disclosure requirements laid down in regulation (eu) 2019/2088. they should be given the possibility to report according to standards that are proportionate to the capacities and resources of smes. non-listed smes can either choose to use these proportionate standards on a voluntary basis , or report according to the standards applicable to large undertakings. the sme standards will set a reference for undertakings that are within the scope of the directive regarding the level of sustainability information that they could reasonably request from sme suppliers and clients in their value chains.


### (20) article 23(4) , first subparagraph , point (i) , and article 23(4) , fourth subparagraph of directive 2004/109/ec empower the commission to adopt measures to set up a mechanism for the determination of equivalence of information required under the directive , and for the establishment of general equivalence criteria regarding accounting standards , respectively. article 23(4) , third subparagraph , of directive 2004/109/ec also empowers the commission to take the necessary decisions on the equivalence of accounting standards that are used by third-country issuers. in order to reflect the inclusion of the sustainability requirements in directive 2004/109/ec , the commission should be empowered to establish a mechanism for the determination of equivalence of sustainability reporting standards applied by third-country issuers of securities. for the same reason , the commission should also be empowered to take the necessary decisions on the equivalence of sustainability reporting standards that are used by third-country issuers. those amendments will ensure consistent equivalence regimes for sustainability reporting obligations and for financial reporting obligations regarding the annual financial report. ### deleted


### (21) articles 19a(3) and 29a(3) of directive 2013/34/eu currently exempt all subsidiary undertakings from the obligation to report non-financial information where such undertakings and their subsidiary undertakings are included in the consolidated management report of their parent undertaking , provided this includes the required non-financial information. it is necessary , however to ensure that sustainability information is easily accessible for users , and to bring transparency about which is the parent undertaking of the exempted subsidiary undertaking which is reporting at consolidated level. it is therefore necessary to require those subsidiary undertakings to publish the consolidated management report of their parent undertaking and to include a reference in their management report to the fact that they are exempted from reporting sustainability information. that exemption should also apply where the parent undertaking reporting at consolidated level is a third country undertaking reporting sustainability information in accordance with the requirements of this directive or in a manner equivalent to eu sustainability reporting standards. ### (21) articles 19a(3) and 29a(3) of directive 2013/34/eu currently exempt all subsidiary undertakings from the obligation to report non-financial information where such undertakings and their subsidiary undertakings are included in the consolidated management report of their parent undertaking , provided this includes the required non-financial information. it is necessary , however to ensure that sustainability information is easily accessible for users , for the whole undertaking and its subsidiaries. in this regard , the reports made by subsidiary undertakings should be added to the undertakings’ own report to generate an aggregate , public overview country-by-country similar to the transparency requirements set out in the public-country-by-country directive1a.


### (21) articles 19a(3) and 29a(3) of directive 2013/34/eu currently exempt all subsidiary undertakings from the obligation to report non-financial information where such undertakings and their subsidiary undertakings are included in the consolidated management report of their parent undertaking , provided this includes the required non-financial information. it is necessary , however to ensure that sustainability information is easily accessible for users , and to bring transparency about which is the parent undertaking of the exempted subsidiary undertaking which is reporting at consolidated level. it is therefore necessary to require those subsidiary undertakings to publish the consolidated management report of their parent undertaking and to include a reference in their management report to the fact that they are exempted from reporting sustainability information. that exemption should also apply where the parent undertaking reporting at consolidated level is a third country undertaking reporting sustainability information in accordance with the requirements of this directive or in a manner equivalent to eu sustainability reporting standards. ### (21) articles 19a(3) and 29a(3) of directive 2013/34/eu currently allow all subsidiary undertakings to report their non-financial information through the consolidated management report of their parent undertaking , provided this includes all the required non-financial information. it is necessary , however to ensure that sustainability information is easily accessible for users , and to bring transparency about which is the parent undertaking of the exempted subsidiary undertaking which is reporting at consolidated level. it is therefore necessary to require those subsidiary undertakings to publish the consolidated management report of their parent undertaking and to include a reference in their management report to the fact that they are exempted from drafting their own sustainability information report.


### (23) credit institutions and insurance undertakings play a key role in the transition towards a fully sustainable and inclusive economic and financial system in line with the european green deal. they can have significant positive and negative impacts via their lending , investment and underwriting activities. credit institutions and insurance undertakings other than those that are required to comply with directive 2013/34/eu , including cooperatives and mutual undertakings , should therefore be subject to sustainability reporting requirements provided that they meet certain size criteria. users of that information would thus be enabled to assess both the impacts of these undertakings on society and the environment and the risks arising from sustainability matters that these undertakings could face. to ensure coherence with the reporting requirements of council directive 86/635/eec50 on the annual accounts and consolidated accounts of banks and other financial institutions , sustainability reporting member states may choose not to apply sustainability reporting requirements to credit institutions listed in article 2(5) of directive 2013/36/eu of the european parliament and of the council51 . ### (23) credit institutions and insurance undertakings play a key role in the transition towards a fully sustainable and inclusive economic and financial system in line with the european green deal. they can have significant positive and negative impacts via their lending , investment and underwriting activities. credit institutions and insurance undertakings other than those that are required to comply with directive 2013/34/eu , including cooperatives and mutual undertakings , should therefore be subject to sustainability reporting requirements . users of that information would thus be enabled to assess both the impacts of these undertakings on society and the environment and the risks arising from sustainability matters that these undertakings could face. to ensure coherence with the reporting requirements of council directive 86/635/eec50 on the annual accounts and consolidated accounts of banks and other financial institutions , sustainability reporting member states may choose not to apply sustainability reporting requirements to credit institutions listed in article 2(5) of directive 2013/36/eu of the european parliament and of the council51 .


### (24) the list of sustainability matters on which undertakings are required to report should be as coherent as possible with the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088. that list should also correspond to the needs and expectations of users and undertakings themselves , who often use the terms ‘environmental’ , ‘social’ and ‘governance’ as a means to categorise the three main sustainability matters. the list of sustainability factors laid down in regulation (eu) 2019/2088 does not explicitly include governance matters. the definition of sustainability matters in directive 2013/34/eu should therefore be based on the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 , but with the addition of governance matters. ### (24) the list of sustainability matters on which undertakings are required to report should be as coherent as possible with the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 and the existing standards of the international global reporting initiative (gri). that list should also correspond to the needs and expectations of users and undertakings themselves , who often use the terms ‘environmental’ , ‘social’ and ‘governance’ as a means to categorise the three main sustainability matters. the list of sustainability factors laid down in regulation (eu) 2019/2088 does not explicitly include governance matters. the definition of sustainability matters in directive 2013/34/eu should therefore be based on the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 , but with the addition of governance matters. the list is a minimum requirement , which will not lower existing national reporting requirements.


### (24) the list of sustainability matters on which undertakings are required to report should be as coherent as possible with the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088. that list should also correspond to the needs and expectations of users and undertakings themselves , who often use the terms ‘environmental’ , ‘social’ and ‘governance’ as a means to categorise the three main sustainability matters. the list of sustainability factors laid down in regulation (eu) 2019/2088 does not explicitly include governance matters. the definition of sustainability matters in directive 2013/34/eu should therefore be based on the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 , but with the addition of governance matters. ### (24) the list of sustainability matters on which undertakings are required to report should be as coherent as possible with the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088. that list should also correspond to the needs and expectations of users and undertakings themselves , who often use the terms ‘environmental’ , ‘social’ and ‘governance’ as a means to categorise the three main sustainability matters. the list of sustainability factors laid down in regulation (eu) 2019/2088 does not explicitly include governance matters. the definition of sustainability matters in directive 2013/34/eu should therefore be based on the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 , but with the addition of governance matters. the list of environmentally sustainable matters should be based on , and take account of underlying indicators and methodologies set out in regulation(eu) 2020/852 and various delegated acts adopted pursuant to it , as they jointly create a classification system of environmentally sustainable economic activities.


### (24) the list of sustainability matters on which undertakings are required to report should be as coherent as possible with the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088. that list should also correspond to the needs and expectations of users and undertakings themselves , who often use the terms ‘environmental’ , ‘social’ and ‘governance’ as a means to categorise the three main sustainability matters. the list of sustainability factors laid down in regulation (eu) 2019/2088 does not explicitly include governance matters. the definition of sustainability matters in directive 2013/34/eu should therefore be based on the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 , but with the addition of governance matters. ### (24) the list of sustainability matters on which undertakings are required to report should be as coherent as possible with the definition of ‘sustainability factors’ laid down in regulation (eu) 2019/2088. that list should also correspond to the needs and expectations of users and undertakings themselves , who often use the terms ‘environmental’ , ‘social’ and ‘governance’ as a means to categorise the three main sustainability matters. the list of sustainability factors laid down in regulation (eu) 2019/2088 does not explicitly include governance matters. the definition of sustainability matters in directive 2013/34/eu should therefore be based on the definition , indicators and methodologies of ‘sustainability factors’ laid down in regulation (eu) 2019/2088 and the associated delegated acts , but with the addition of governance matters.


### (26) articles 19a(1) and 29a(1) of directive 2013/34/eu require undertakings to disclose information about five reporting areas: business model , policies (including due diligence processes implemented) , the outcome of those policies , risks and risk management , and key performance indicators relevant to the business. article 19a(1) of directive 2013/34/eu does not contain explicit references to other reporting areas that users of information consider relevant , some of which align with disclosures included in international frameworks , including the recommendations of the task force on climate-related financial disclosures. disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. in addition to the reporting areas identified in articles 19a(1) and 29a(1) of directive 2013/34/eu , undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters , any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate-neutral economy; whether and how their business model and strategy take account of the interests of stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect , or are affected by sustainability matters; any sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the principal actual and potential adverse impacts connected with the undertaking’s activities; and how the undertaking has identified the information that they report on. once the disclosure of elements such as targets and the progress towards achieving them is required , the separate requirement to disclose the outcomes of policies is no longer necessary. ### (26) articles 19a(1) and 29a(1) of directive 2013/34/eu require undertakings to disclose information about five reporting areas: business model , policies (including due diligence processes implemented) , the outcome of those policies , risks and risk management , and key performance indicators relevant to the business. article 19a(1) of directive 2013/34/eu does not contain explicit references to other reporting areas that users of information consider relevant , some of which align with disclosures included in international frameworks , including the recommendations of the task force on climate-related financial disclosures. disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. in addition to the reporting areas identified in articles 19a(1) and 29a(1) of directive 2013/34/eu , undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters , any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate-neutral economy; whether and how their business model and strategy ensure decent work , fair wages , rights of workers and trade unions and take account of the interests of the undertaking’s stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect , or are affected by sustainability matters; any sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the principal actual and potential adverse impacts connected with the undertaking’s activities; and how the undertaking has identified the information that they report on. once the disclosure of elements such as targets and the progress towards achieving them is required , the separate requirement to disclose the outcomes of policies is no longer necessary.


### (26) articles 19a(1) and 29a(1) of directive 2013/34/eu require undertakings to disclose information about five reporting areas: business model , policies (including due diligence processes implemented) , the outcome of those policies , risks and risk management , and key performance indicators relevant to the business. article 19a(1) of directive 2013/34/eu does not contain explicit references to other reporting areas that users of information consider relevant , some of which align with disclosures included in international frameworks , including the recommendations of the task force on climate-related financial disclosures. disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. in addition to the reporting areas identified in articles 19a(1) and 29a(1) of directive 2013/34/eu , undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters , any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate-neutral economy; whether and how their business model and strategy take account of the interests of stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect , or are affected by sustainability matters; any sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the principal actual and potential adverse impacts connected with the undertaking’s activities; and how the undertaking has identified the information that they report on. once the disclosure of elements such as targets and the progress towards achieving them is required , the separate requirement to disclose the outcomes of policies is no longer necessary. ### (26) articles 19a(1) and 29a(1) of directive 2013/34/eu require undertakings to disclose information about five reporting areas: business model , policies (including due diligence processes implemented) , the outcome of those policies , risks and risk management , and key performance indicators relevant to the business. article 19a(1) of directive 2013/34/eu does not contain explicit references to other reporting areas that users of information consider relevant , some of which align with disclosures included in international frameworks , including the recommendations of the task force on climate-related financial disclosures. disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. in addition to the reporting areas identified in articles 19a(1) and 29a(1) of directive 2013/34/eu , undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters , any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate-neutral economy; whether and how their business model and strategy take account of the interests of stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect , or are affected by sustainability matters; any sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the actual and potential adverse impacts connected with the undertaking’s activities; and how the undertaking has identified the information that they report on. once the disclosure of elements such as targets and the progress towards achieving them is required , the separate requirement to disclose the outcomes of policies is no longer necessary.


### (26) articles 19a(1) and 29a(1) of directive 2013/34/eu require undertakings to disclose information about five reporting areas: business model , policies (including due diligence processes implemented) , the outcome of those policies , risks and risk management , and key performance indicators relevant to the business. article 19a(1) of directive 2013/34/eu does not contain explicit references to other reporting areas that users of information consider relevant , some of which align with disclosures included in international frameworks , including the recommendations of the task force on climate-related financial disclosures. disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. in addition to the reporting areas identified in articles 19a(1) and 29a(1) of directive 2013/34/eu , undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters , any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate-neutral economy; whether and how their business model and strategy take account of the interests of stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect , or are affected by sustainability matters; any sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the principal actual and potential adverse impacts connected with the undertaking’s activities; and how the undertaking has identified the information that they report on. once the disclosure of elements such as targets and the progress towards achieving them is required , the separate requirement to disclose the outcomes of policies is no longer necessary. ### (26) articles 19a(1) and 29a(1) of directive 2013/34/eu require undertakings to disclose information about five reporting areas: business model , policies (including due diligence processes implemented) , the outcome of those policies , risks and risk management , and key performance indicators relevant to the business. article 19a(1) of directive 2013/34/eu does not contain explicit references to other reporting areas that users of information consider relevant , some of which align with disclosures included in international frameworks , including the recommendations of the task force on climate-related financial disclosures. disclosure requirements should be specified in sufficient detail to ensure that undertakings report information on their resilience to risks related to sustainability matters. in addition to the reporting areas identified in articles 19a(1) and 29a(1) of directive 2013/34/eu , undertakings should therefore be required to disclose information about their business strategy and the resilience of the business model and strategy to risks related to sustainability matters , any plans they may have to ensure that their business model and strategy are compatible with the transition to a sustainable and climate-neutral economy; whether and how their business model and strategy take account of the interests of stakeholders; any opportunities for the undertaking arising from sustainability matters; the implementation of the aspects of the business strategy which affect , or are affected by sustainability matters; any sustainability targets set by the undertaking and the progress made towards achieving them; the role of the board and management with regard to sustainability matters; the actual and potential adverse impacts connected with the undertaking’s activities; a due diligence strategy for identifying actual or potential adverse impacts and addressing them; and how the undertaking has identified and evaluated the information that they report on. once the disclosure of elements such as targets and the progress towards achieving them is required , the separate requirement to disclose the outcomes of policies is no longer necessary.


### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the principal actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains. in alignment with the un guiding principles on business and human rights , an actual or potential adverse impact is to be considered principal where it measures among the greatest impacts connected with the undertaking’s activities based on: the gravity of the impact on people or the environment; the number of individuals that are or could be affected , or the scale of damage to the environment; and the ease with which the harm could be remediated , restoring the environment or affected people to their prior state. ### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the principal actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s supply and value chain. the due diligence process , notably human rights and environmental due diligence , concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains. in alignment with the un guiding principles on business and human rights , an actual or potential adverse impact is to be considered principal where it measures among the greatest impacts connected with the undertaking’s activities based on: the gravity of the impact on people or the environment; the number of individuals that are or could be affected , or the scale of damage to the environment; and the ease with which the harm could be remediated , restoring the environment or affected people to their prior state.


### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the principal actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains. in alignment with the un guiding principles on business and human rights , an actual or potential adverse impact is to be considered principal where it measures among the greatest impacts connected with the undertaking’s activities based on: the gravity of the impact on people or the environment; the number of individuals that are or could be affected , or the scale of damage to the environment; and the ease with which the harm could be remediated , restoring the environment or affected people to their prior state. ### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains.


### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the principal actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains. in alignment with the un guiding principles on business and human rights , an actual or potential adverse impact is to be considered principal where it measures among the greatest impacts connected with the undertaking’s activities based on: the gravity of the impact on people or the environment; the number of individuals that are or could be affected , or the scale of damage to the environment; and the ease with which the harm could be remediated , restoring the environment or affected people to their prior state. ### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains. in alignment with the un guiding principles on business and human rights , an actual or potential impact should be considered adverse based on: the gravity of the impact on people or the environment; the number of individuals that are or could be affected , or the scale of damage to the environment; and the ease with which the harm could be remediated , restoring the environment or affected people to their prior state.


### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the principal actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains. in alignment with the un guiding principles on business and human rights , an actual or potential adverse impact is to be considered principal where it measures among the greatest impacts connected with the undertaking’s activities based on: the gravity of the impact on people or the environment; the number of individuals that are or could be affected , or the scale of damage to the environment; and the ease with which the harm could be remediated , restoring the environment or affected people to their prior state. ### (27) to ensure consistency with international instruments such as the un guiding principles on business and human rights and the oecd due diligence guidance for responsible business conduct , the due diligence disclosure requirements should be specified in greater detail than is the case in article 19a(1) , point (b) , and article 29a(1) , point (b) of directive 2013/34/eu. the disclosure requirements related to the due diligence requirements in this directive will need to be adapted once the upcoming directive on sustainable corporate governance and due diligence has been adopted so that the requirements in this directive are aligned with those in the upcoming directive. due diligence is the process that undertakings carry out to identify , prevent , mitigate and remediate the actual and potential adverse impacts connected with their activities and identifies how they address those adverse impacts. impacts connected with an undertaking’s activities include impacts directly caused by the undertaking , impacts to which the undertaking contributes , and impacts which are otherwise linked to the undertaking’s value chain. the due diligence process concerns the whole value chain of the undertaking including its own operations , its products and services , its business relationships and its supply chains.


### (29) articles 19a(1) and 29a(1) of directive 2013/34/eu do not specify whether the information to be reported is to be forward looking or information about past performance. there is currently a lack of forward-looking disclosures , which users of sustainability information especially value. articles 19a and 29a of directive 2013/34/eu should therefore specify that the sustainability information reported shall include forward-looking and retrospective , and both qualitative and quantitative information. reported sustainability information should also take into account short , medium and long-term time horizons and contain information about the undertaking’s whole value chain , including its own operations , its products and services , its business relationships , and its supply chain , as appropriate. information about the undertaking’s whole value chain would include information related to its value chain within the eu and information that covers third countries if the undertaking’s value chain extends outside the eu. ### (29) articles 19a(1) and 29a(1) of directive 2013/34/eu do not specify whether the information to be reported is to be forward looking or information about past performance. there is currently a lack of forward-looking disclosures , which users of sustainability information especially value. articles 19a and 29a of directive 2013/34/eu should therefore specify that the sustainability information reported shall include forward-looking and retrospective , and both qualitative and quantitative information. reported sustainability information should also take into account short , medium and long-term time horizons and contain information about the undertaking’s whole value chain , including its own operations , its products and services , its business relationships , and its supply chain. information about the undertaking’s whole value chain would include information related to its value chain within the eu and information that covers third countries if the undertaking’s value chain extends outside the eu.