Belgium transposes the EU's Corporate Sustainability Reporting Directive into national law

28 Nov 2024    2 minute read
EU regulations Sustainability Compliance CSDDD CSRD Corporate Sustainability Reporting Directive Belgium

In brief

On 28 November 2024, the Belgian Parliament adopted a bill to transpose the EU's Corporate Sustainability Reporting Directive (CSRD) into national law, addressing an overdue deadline of 6 July 2024. 

This legislative step follows Belgium's delayed transposition and the subsequent formal notice issued by the European Commission, which called on Belgium (together with 16 other Member States) to meet the CSRD obligations to enhance corporate sustainability transparency across EU Member States. 

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Companies should ensure that they are aware of their new obligations under this legislation. 

In more detail

The CSRD mandates more extensive sustainability reporting requirements for companies, requiring information on environmental, social, and governance (ESG) factors in line with European Sustainability Reporting Standards (ESRS) adopted by the European Commission. The CSRD aims to ensure that companies provide consistent, comparable, and reliable sustainability information. Belgium's transposition aligns local requirements with these obligations, expanding on prior non-financial reporting frameworks to include standardized, comparable ESG disclosures that are critical for EU-wide transparency and investor decision-making. 

Certain large Belgian companies that are public-interest entities were already required to submit non-financial reports including social and environmental criteria under the existing NFRD. However, these obligations were less detailed and less stringent than those introduced by the CSRD, which aims to harmonize and strengthen sustainability reporting requirements. Companies in scope of the CSRD will need to report in-depth data on, among others, climate impact, workforce diversity, human rights, and anti-corruption measures. The reports must adhere to ESRS, covering risks, impacts, and governance, with an emphasis on verifiability and comparability. Companies will need to align (and if necessary, amend) their existing data collection and reporting frameworks, which necessitates thorough preparation and cross-departmental coordination.

The new reporting obligations under the CSRD will be phased in over the coming years according to company size and other factors, beginning with companies already subject to the NFRD obligations. Those companies will need to report for their financial year starting on or after 1 January 2024. Other companies will benefit from one or more years of delay.

Failure to comply with CSRD obligations could lead to significant regulatory fines, audits, as well as potential reputational damage. 

The law must now be published in the Belgian Official Gazette to officially enter into force.

Please do not hesitate to reach out to our experts for further information.

Contact Information
Roel Meers
Partner
Brussels
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roel.meers@bakermckenzie.com
William-James Kettlewell
Counsel
Brussels
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william-james.kettlewell@bakermckenzie.com
Pieter-Jan Denys
Associate
Brussels
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pieter-jan.denys@bakermckenzie.com
Emilien Lerouge
Associate
Brussels
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emilien.lerouge@bakermckenzie.com

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