EC targets more environmental disclosure from companies

The European Commission is pursuing legislation that will require large companies to publish more information about their environmental impact in annual reports.

The EC's proposed changes to accounting laws would see companies with more than 500 employees disclosing further information on policies, risks and results, human rights, anti-corruption among other things.

Approximately 2,500 organisations currently disclose environmental information on a regular basis and this number would rise to around 18,000 when the new law comes into effect.

According to the EC, comprehensive analysis and reporting on environmental issues costs up to €600,000 per year. This factor has been considered and evaluated as part of the new law which is predicted will cost companies less than €5,000 a year.

Senior officials at the European Parliament have welcomed the initiative as an important step towards sustainable and accountable business.

The EC proposal was announced on the same day that the International Integrated Reporting Council (IIRC), a group of some of the largest organisations and accounting firms, launched a consultation on the future of integrated reporting. The prototype reporting framework will allow the preparers of financial reports to integrate non-financial information, such as environmental and social economic costs, into financial statements.

Last week, the EC reached a deal with the European parliament to force large extractive companies to shed light on their dealings with national governments on a country-by-country basis. The agreement requires European companies to disclose full information on payments of more than €100,000 (£85,000) to governments in resource rich countries.