19 Jul 2022
Bucharest, 19 July 2022 For most Romanian listed companies, non-financial reporting is a compliance issue. Only 30% have an implementation plan for environmental, social and governance (ESG) objectives, and only 10% have an integrated business and sustainability strategy, according to the report “ESG − A chance for strategic change?” produced by PwC Romania in collaboration with the Bucharest Stock Exchange (BVB).
Moreover, with regulatory and reporting requirements set to become more stringent by 2023, 50% of the survey respondents still do not apply any reporting standards.
“Given the European Union’s ambitions to reduce carbon emissions and the looming new regulations in this area, companies’ sustainability commitments are becoming urgent. The tone is being set by listed companies required to implement responsible operating models and transparency to comply with new non-financial reporting regulations. Under the European Recovery Fund, financial resources will be allocated to transition projects in this area, and companies that meet specific conditions will be able to apply for funding. Companies wishing to apply should start preparing now at the strategy and reporting level”, said Monica Movileanu, Partner and ESG Leader of PwC Romania.
Shareholders and investors are increasingly focusing on sustainable models. If organisations do not have a sustainability strategy and do not publish quality non-financial reports, they could face problems in audit processes, finding funding sources and contacting investors and customers.
From the investors’ point of view, corporate ESG implementation is seen as a requirement for better risk management, improved operations and sustainable growth. The projects we have initiated at the BVB level, namely ESG ratings for companies listed on the main market, as well as the publication of our ESG guidelines, have been aimed at improving local issuers’ understanding and capacity, mainly in terms of institutional investors’ expectations. We hope that all relevant stakeholders, regulators, issuers, investors and ESG organisations will be able to find a balanced approach to address the current ESG shortcomings and increase the reliability and trust in ESG data in the future”, said Remus Danilă, Head of Business Development of the Bucharest Stock Exchange.
The report’s other conclusions
The full report can be found on the PwC Romania website here.
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Monica Movileanu
Partner and ESG Leader
PwC Romania