Under Directive 2014/95/EU, large companies with more than 500 employees are required to disclose certain non-financial and diversity information in their annual reports. The main objective of the Directive is to boost corporate transparency and performance by increasing trust among stakeholders, investors and consumers. The Directive entered into force on 6 December 2014 and shall be applied as of 2018 with respect to the information relating to the FY 2017.
The information to be disclosed under the Directive include inter alia policies, outcomes, relevant non-financial key performance indicators, environmental aspects, social and employee matters, respect for human rights, anti-corruption and bribery issues. The Directive provides flexibility for the companies as they may disclose the relevant information in a way that they consider the most appropriate.
On 26 June 2017, the European Commission adopted guidelines on the disclosure of non-financial information by companies. The guidelines supplement the provisions of the Directive and are not mandatory for the companies. The aim of the guidelines is to help companies to comply with the disclosure obligations set out in the Directive in a consistent and comparable manner. According to the Commission, the application of the guidelines will enhance business transparency on social and environmental matters.