From Omnibus to Ukrainian Realities: How ESG Standards Are Changing and What Businesses Should Expect
Oleksiy Yatsiuk, an ESG expert from the Green Transition Office, presented a comprehensive analysis of European sustainability reporting standards and the readiness of Ukrainian businesses to implement them.
During the presentation, the EU regulatory landscape in the field of sustainable development was examined in detail, which currently includes 140 directives already developed and another 40 directives in the development process. Special attention was paid to recent changes, particularly the Omnibus simplification package, which the European Commission presented on February 26, 2024.
According to the new proposals, the criteria for mandatory reporting are significantly changing – now the requirements will only apply to companies with more than 1,000 employees, which will reduce the number of enterprises subject to regulation by 80%. Additionally, the deadlines for implementing reporting for the second and third waves of companies are being postponed by two years. Among other important changes, the expert noted the complete elimination of sector-specific standards and the cancellation of sanctions amounting to 5% of turnover, which were previously envisaged for non-compliance.
Oleksiy Yatsyuk emphasized that these changes stem from an analytical report prepared by former European Bank head Mario Draghi on improving the competitiveness of the EU economy. Based on this report, the European Commission developed a "Competency Compass" that defines ways to strengthen the European community's position in the global market.
Regarding the situation in Ukraine, a key event was the adoption of the national strategy for implementing sustainability reporting, which provides for synchronization with the requirements of the CSRD directive and ESRS standards. To implement this strategy, an operational plan and draft legislative changes have already been developed, which envisage the introduction of mandatory sustainability reporting.
Of particular interest were the results of a representative study on the readiness of Ukrainian businesses for ESG standards, commissioned by the Green Transition Office. The study covered enterprises of various sizes and industries throughout the country. The results revealed important trends:
- Only a small percentage of Ukrainian companies indicate that they fully understand what sustainable business is
- However, the majority of surveyed enterprises (over 50%) consider their business sustainable
- The level of awareness regarding specific sustainable development standards is approximately equally low among respondents: the popularity of various standards (GRI, SASB, TCFD, and others) does not differ significantly
- Notably, according to the expert, there is a tendency toward "forgetting" GRI standards, which were previously the most recognizable
The most optimistic discovery of the study was that, despite low awareness, most companies (both among those who know about ESG and those who don't) express a rather positive or completely positive attitude toward implementing ESG standards in Ukraine.
Regarding timeframes, many surveyed companies demonstrated ambitious expectations, stating that with proper regulatory instructions, they would be ready to implement ESG standards within a year.
"These data indicate significant potential for implementing sustainable development practices in Ukraine. We all need to help utilize this potential and help businesses understand how to implement these standards," emphasized Oleksiy Yatsyuk.
The expert also announced that the complete results of the study will be presented at the end of March at a separate event, where deeper insights obtained from focus groups and individual interviews with business representatives will be discussed.
The full video recording of the presentation is available at the following link: video.
You can also view the presentation at the following link: presentation_ukr.
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