The EU is working to reform its Non-Financial Reporting Directive, regulation introduced in 2014 requiring large companies to report on environmental and social issues, such as the impact of climate change on their business and the diversity of its board. The proposed new rules, called the Corporate Sustainability Reporting Directive (CSRD), would expand the reporting requirements and drastically increase the number of companies disclosing this information. CSRD would also make auditing of companies’ sustainability reports obligatory.   Corporations, regulators and investors increasingly recognize that environmental, social and governance risks need to be accounted for alongside financial risks when valuing a company. Investors are seeking consistent data and standards to guide them in their investment decisions around ESG factors. In this episode, we speak to Saskia Slomp, CEO of European Financial Reporting Advisory Group, or EFRAG, which advises the EU on the use of accounting standards within the bloc and which was asked by the European Commission, the EU’s executive arm, to develop proposals for the new directive. “The development of mandatory common sustainability reporting standards is necessary to progress to a situation in which sustainability information has a status comparable to that of financial information,” she tells us. “So many companies receive additional information requests for sustainability information from stakeholders."   Photo credit: Getty Images   Related past podcast episodes:    Banks’ big green EU taxonomy challenge https://podcasts.apple.com/us/podcast/banks-big-green-eu-taxonomy-challenge/id1475521006?i=1000511776202   EU revolutionizes sustainability regulation with SFDR https://podcasts.apple.com/us/podcast/eu-revolutionizes-sustainability-regulation-with-sfdr/id1475521006?i=1000514008934