Best practices for printers to meet new EU environmental regulations

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The European Union has strengthened sustainability disclosure rules, requiring more than 50,000 listed companies (listed companies with more than 500 employees or annual sales of more than 500 million euros), including printing companies, to improve their environmental, social and governance ( ESG). From 2024 onwards, it will be disclosed in the annual report.

ESG involves measuring a company’s impact on the environment and society. This report provides investors and consumers with transparent data on companies’ environmental footprint, social initiatives, and governance practices.

ESG reporting is mandatory in the EU. In the UK, ESG reporting is mandatory for large listed companies.

However, for printers without experience, creating reports may be difficult. Dr. Michael Has, a partner at his Monopteros GmbH in Germany, suggests making at least a few attempts before becoming legally required to report, in order to gain adequate experience.

OECD Guidelines for Multinational Enterprises

Organization for Economic Co-operation and Development (OECD) guidelines outline what companies need to do to report ESG.

According to OECD guidelines, businesses must conduct their activities in a way that contributes to the broader goal of sustainable development. Some of the goals are:

  • Establish and maintain an environmental management system.
  1. *Collecting and evaluating information regarding the environmental impact of activities.
  2. * Set measurable objectives and goals.
  3. * Regularly monitor and review progress towards environmental goals.
  • Provide relevant, measurable, verifiable and timely information to the public and workers.
  • Communicate and consult with affected communities in a timely manner.
  • Assessing and considering foreseeable environmental impacts associated with processes, products, and services throughout a company’s life cycle.
  • Lack of complete scientific certainty will not be considered a reason for postponement.
  • Develop and communicate emergency response plans to prevent, reduce, and control serious environmental hazards.
  • Continuous efforts to improve the environmental performance of the company and, where appropriate, the supply chain, by promoting activity-specific proposals.
  • Education and training of workers on environmental issues.

Further regulations to comply with

EU Corporate Sustainability Reporting Directive: This EU law requires EU companies to disclose their environmental and social impact and how ESG initiatives impact their business.

EU classification directive: This Regulation describes a framework for classifying sustainable economic activities carried out within the EU. For example, institutions must obtain certain information from the companies in which they invest, such as carbon footprint data, and summarize it in annual reports.

Emissions trading system: It forces polluters to pay for their greenhouse gas emissions and aims to explain how to buy and trade certificates.

Carbon boundary adjustment mechanism: It is a tool to put a fair price on the carbon emitted during the production of carbon-intensive products entering the EU and to encourage cleaner industrial production in non-EU countries.

Corporate due diligence obligations in the supply chain: This law applies to Tier 1 carriers and customers. The law includes the establishment of risk management systems to identify, prevent or minimize the risks of human rights violations and environmental damage throughout the supply chain.

See also: Achieving sustainability goals with CO2 emissions calculations

Please report only what applies to your company

Companies can report based on footprints such as biosphere integrity, CO2 concentration, atmospheric aerosols, ocean acidification, terrestrial biomass change, and freshwater change.

“There are many reporting items, and the list can be as long as 400-500. This can be limited with the help of materiality and codes of conduct,” Hass said.

Materiality assessments aim to identify and understand the relative importance of particular ESG and sustainability topics to an organization.

In the supply chain, controlling the environmental footprint of suppliers can be difficult. Implementing robust codes of conduct (CoC) for companies in the supply chain is the solution.

Companies can incorporate specific codes to establish minimum standards that suppliers or subcontractors must meet to maximize their ability to fulfill their ESG commitments.

“By doing so, we can hold suppliers accountable for their actions regarding their involvement in social and governance issues. This could also be grounds for terminating the relationship and mitigating potential risks.” Yes,” Hass said.

Three points to keep in mind:

  • Please report what you are legally required to do.
  • Report on matters important to the company.
  • We report measurements taken within our supply chain as described in our Code of Conduct.

“Writing a report is difficult.”

Creating an ESG report is difficult because it requires experience throughout the entire process. “It’s an iterative process. Reports are frequently rewritten,” Hass said.

The following points briefly explain how to create a report.

  • Identification of footprint application.
  • Metrics used.
  • Lifecycle assessment/assessment of each footprint with reference to internal processes, Tier 1 and direct customers, and the entire value chain.
  • Measures to assess data and reduce risks within the company and supply chain.
  • Risk before countermeasures.
  • Measures to reduce footprint.
  • Risk after countermeasures.

Once the report is completed, it will be reviewed and analyzed internally, and certain actions will be taken based on it.

The CEO, CFO, or other stakeholders within the company read and paraphrase internal reports. This report will be passed to an external examiner or auditor to assess whether everything has been adequately reported. The results are then submitted to external companies and rating agencies to evaluate corporate value.

“ESG is as important as financial reporting”

“For the first year, the version you have is definitely not the final version,” Hass said, adding, “but it gives you a chance to get used to the process.”

The report must be submitted within four months after the end of the financial year. The law gives his ESG report as much weight as financial reports and clearly influences the interest rate a company pays to banks.

“It’s best to start learning early, as regulations will become even more stringent in the future,” Has concluded.

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