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2024 Business Sustainability: Key Legislative Updates and Trends

2024 marks a significant phase in the journey towards sustainability for businesses around the globe.
02/01/24
TL;DR Embed
TL;DR: In 2024, businesses face a transformative shift towards sustainability, driven by new legislation and changing market dynamics. Key developments include the implementation of UK Sustainability Disclosure Standards, updates to FCA climate-related reporting rules, and a broader focus on nature and biodiversity. These changes, aligning with global trends, require companies to adapt their strategies to meet both legal requirements and evolving societal expectations for environmental responsibility.

Various trends and legislative changes are set to reshape how companies approach environmental and social responsibilities this year. This article discusses some of the key aspects that businesses should be aware of.

Sustainability Disclosure Standards (SDS)

The UK government is working to establish UK SDS by July 2024, using the IFRS Sustainability Disclosure Standards as a foundation. These standards will be mandatory for UK registered companies and limited liability partnerships, as well as UK listed companies. The aim is to ensure globally comparable and decision-useful disclosures for investors. It will require businesses to disclose material information on sustainability-related risks and opportunities, indicating a broad application across both private and publicly traded companies in the UK.

Corporate Sustainability Reporting Directive (CSRD)

Over 50,000 companies will be impacted by the EU’s Corporate Sustainability Reporting Directive (CSRD). This regulation mandates increased transparency in businesses' environmental impacts. The UK's initiatives, although distinct, align with this broader European trend towards comprehensive sustainability reporting.

Updates to Existing Climate-Related Reporting Rules

The UK’s Financial Conduct Authority (FCA) plans to update its rules on climate-related reporting for listed companies. These updates, expected to be based on the UK-endorsed ISSB standards, will likely come into effect for accounting periods beginning on or after January 1, 2025. The FCA's new rules will apply to UK listed companies, ensuring alignment with global reporting standards.

Finance Sector's Critical Role in Net Zero Transition

In the finance industry, 2024 is viewed as a pivotal year for the net zero transition. The sector's response includes supporting policies for decarbonising housing and aiding SMEs in sustainable transitions. The ISSB Standards will be crucial in providing consistent disclosures and data for this transition.

Beyond Carbon: Focus on Nature and Biodiversity

Sustainability is increasingly recognised as encompassing more than just carbon emissions. Protection of nature and biodiversity is becoming a key focus area, with about a third of Europe's largest companies setting targets in these domains.

The business sustainability landscape is evolving rapidly, and 2024 will see a range of legislative and societal changes toward a better environment. Businesses must adapt to these trends and regulations to meet legal requirements and align with societal shifts towards sustainability.

FutureTracker is the perfect tool for businesses navigating these dynamic sustainability trends. With its comprehensive features and expert guidance, it empowers organisations to not only comply with evolving regulations but also to lead in sustainable practices. As the landscape shifts, FutureTracker stands as a reliable and innovative partner, helping businesses transform challenges into opportunities for sustainable growth and leadership.

If you’d like to learn more, please book a demo here.

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