In this week’s Sustainability/ESG bulletin, read about the green measures announced in Budget 2024; how cost remains the main barrier to sustainability in Irish businesses; updates on the Circular Economy; the issuance of ESB’s third green bond; developments in Europe, and the usual roundup of technical updates, articles and events.
Green measures announced in Budget 2024
Budget 2024 was announced this week on Tuesday 10 October. The Chartered Accountants Ireland team of experts analysed, interpreted and prepared informed, reliable commentary on the impact of this year's Budget on business in Ireland.
Among the measures announced was the establishment of two funds to support climate-related initiatives over the medium and long term. Described as a ‘a gamechanger’ in addressing monetary gaps up to 2030, and a way of ‘firewalling’ major climate investment projects well into the next decade, these are:
- a Future Ireland Fund: a long-term savings fund with forecasted levels of contributions of c. €70 billion, or c. €6 billion per year (0.8 percent of GDP) up to 2035, to deal with future recognised expenditure pressures including ageing, climate and the digital transitions
- an Infrastructure, Climate & Nature Fund: a fund due to reach €14 billion by 2030, of which the climate and nature component is worth over €3 billion, to ensure that the State would have resources to support capital expenditure for projects between 2026-2030 in the event of a future downturn.
The General Scheme for the funds has now been published.
Further measures announced in Budget 2024 include €380 million for residential and community energy upgrades, including the Solar PV Scheme, measures related to microgeneration of electricity, reliefs related to battery electric vehicles (EVs), and the annual increase in carbon tax up from €48.50 to €56.00 (Read more)
Research finds cost remains barrier to sustainability for Irish businesses
The Green Business Sentiment Index, published by SSE Airtricity this week, has found that only half of businesses surveyed say that sustainability and climate change impact decision-making, down from 71 percent in 2021. The research, which was carried out among a national representative sample of 359 business owners in Ireland, aims to measure and track any change in attitude among businesses towards sustainable practices and decarbonisation since the Index was last published in 2021. The research found that cost remains the main barrier for businesses in reducing carbon footprint, and just 25 percent of Irish businesses agree that being ‘greener’ attracts more customers, down from 42 percent in 2021. 11 percent state that climate change is not at all important for businesses, whereas just 7 percent stated this in 2021, and at least 90 percent believe that it is primarily the responsibility of the Government to tackle climate change. More positively, 19 percent of businesses have incorporated solar panels into their business practices, 38 percent have incorporated smart metering into their environmental practices and the use of electric vehicles (EVs) by businesses is at its highest to date, at 15 percent.
EPA publishes Circular Economy Programme Annual Report for 2022
The EPA has published a report setting out its key activities related to implementing, regulating and measuring the circular economy and waste in 2022. The Circular Economy Programme Annual Report for 2022 noted that of the €322 million spent on contracts in 2020 over €25,000, only 17 percent (€53 million), included green criteria. The EPA noted that this is “a missed opportunity to purchase more resource-efficient, less polluting goods, services and works within the marketplace.”
ESB Raises €1 Billion Funding in Bond Market – including its third Green Bond
The ESB Group has announced it raised €1 billion in bonds which will be used to fund its capital investment programme to deliver a net-zero future. The funds were raised through the issuance of two €500m benchmark bonds. These include a 12-year 4.25 percent fixed-rate green bond which will be allocated exclusively to finance eligible green projects, and a 5-year 4.00 percent fixed-rate bond. The issuance of the third Green Bond in five years follows on from the publication of ESB’s updated Green Bond Framework in September 2023, which reflects changes in sustainable finance best practice including aligning with the EU Taxonomy Regulation (a classification system for environmentally sustainable economic activities).
Supports for women-led businesses – Northern Ireland
A programme has been launched by Invest Northern Ireland (Invest NI) that aims to support women-led businesses to access support, create jobs and sell innovative products or services outside Northern Ireland. The Ambition to Grow | Supporting Women programme, supported by Women in Business Northern Ireland, will provide grant support of up to £30,000 to eligible small and medium-sized businesses that have a woman in a key decision-making position. The funding is aimed at helping to create new employment within the business and assisting with the costs of targeting markets outside Northern Ireland, technical development activities, and upskilling existing and new employees. The deadline for applications Friday, 10 November 2023.
Completion of EU ‘Fit for 55' legislative package
The two final pillars of the ‘Fit for 55' legislative package to deliver the EU's 2030 climate targets were adopted this week. With the adoption of the revised Renewable Energy Directive and the ReFuelEU Aviation Regulation, the EU now has legally binding climate targets covering all key sectors of the economy. The 'Fit for 55' package was tabled in July 2021 to respond to the requirements in the EU Climate Law to reduce Europe’s net greenhouse gas emissions by at least 55 percent by 2030. The final legislative package is expected to reduce EU net greenhouse gas emissions by 57 percent by 2030. The Commission also published Questions and Answers on the EU's Effort Sharing Regulation and boosting natural carbon sinks, and on Making our energy system fit for our climate targets.
Separately, the European Parliament’s Committee on the Environment, Public Health and Food Safety (ENVI) has adopted its proposals to lower pollutant emissions and set battery durability requirements for passenger cars, vans, buses and trucks. Speaking about the proposals, Rapporteur Alexandr Vondra (ECR, CZ) said: “We have successfully struck a balance between environmental goals and the vital interests of manufacturers. It would be counterproductive to implement environmental policies that harm both Europe’s industry and its citizens.”
Technical Updates
(From our Professional Accounting team)
EFRAG has announced it is recommencing the drafting of sector-specific ESRS standards. The ESRS standards are the standards s and are inviting external participants to interact with them as it commences drafting. The sectors where it is seeking participants are as follows:
- Agriculture, Farming and Fishing
- Food and Beverage Services
- Mining, Coal and Quarrying
- Motor Vehicles
- Oil and Gas
- Power Production and Energy Utilities
- Road Transport
- Textiles, Accessories, Footwear and Jewellery
The International Sustainability Standards Board has congratulated the Task Force on Nature-related Financial Disclosures (TNFD) on the publication of its recommendations during New York Climate Week 2023. The TNFD recommendations can help companies communicate nature-related risks and opportunities to investors and other stakeholders.
The ISSB September 2023 Update has been issued, highlighting preliminary decisions of the International Sustainability Standards Board (ISSB). Projects affected by these decisions can be found on the work plan. The ISSB have also released their September 2023 podcast.
The UK Endorsement Board has published two reports as a result of its Climate-related Matters Research Project:
Accountancy Europe - Sustainability update – October 2023
(from our friends in Accountancy Europe)
- Accountancy Europe’s response to ISSB’s Agenda Consultation
- Ongoing trilogue negotiations on CSDDD
- EC seeks to adjust EU SME definition for inflation
- EC adopts DA on ESRS
- IAASB proposes a global standard for sustainability assurance
- IOSCO endorses ISSB standards
Watch: Sustainable Supply Chains
In this 15-minute chat, Institute's Sustainability Officer Susan Rossney chatted to Shane Faulkner, KPMG's Sustainability Manager, about what why sustainable supply chains are important for SMEs, what questions SMEs might be asked by their customers and clients, and what they can do to prepare. Watch back here.
Articles
- Less Than 1 in 3 Boards Have a Strong Understanding of ESG Risks Affecting Their Companies: PwC Survey (ESG Today)
- European sustainability reporting developments: what do they mean for UK companies? (ICAEW)
- Lego’s ESG dilemma: Why an abandoned plan to use recycled plastic bottles is a wake-up call for supply chain sustainability (The Conversation)
- ESG's . . . OK (The Financial Times)
- Why America Trails the World on Climate Fund Investing - The US has fallen far behind Europe, as well as China. But it may be waking up (Bloomberg)
Upcoming Events
Cork Student Society/Young Professionals event – Sustainability and Networking on the Apple Campus
The Cork Branch of the Chartered Accountant Student Society (CASSC) is collaborating with Young Professionals Cork Society to a sustainability and networking evening in the Apple Headquarters in Cork on Thursday, 19 October. Attendees will have the opportunity network, learn about sustainability and get a tour of the Apple campus.
In person: 19 October, 6pm.
Women in Business (Northern Ireland) Women in Finance
Women in Business is running a wide-ranging programme of female entrepreneurship events over the upcoming months. The events include sectoral networking, webinars, and training courses for essential skills. On 25 October 2023, 10am to 11:30am, a specific session on women in finance will focus on work in finance departments, small scale accountancy or work for yourself, both members and non-members are welcome to join this online event.
Sustainable Finance Skillnet is offering funded training opportunities until October and November 2023 to Irish employees in the financial services sector at 30 percent of course fees (with 70 percent funding available for members of the International Sustainable Finance Centre of Excellence). A series of short, deep dive training modules on key sustainable finance topics include
• EU Taxonomy
• Net-Zero
• SFDR (Sustainable Finance Disclosure Regulation)
Book launch! Doing Good Business: How to Build Sustainable Value by Sheila Killian
In Person: 19 October, 6pm, O’Mahony’s Booksellers, O’Connell St, Limerick.
To celebrate the publication of Doing Good Business: How to Build Sustainable Value by Sheila Killian, Professor Finbarr Murphy, Executive Dean of the Kemmy Business School, University of Limerick will launch guide to responsible business. Wine and refreshments will be served and all are welcome.
Chartered Accountants Ireland ESG Masterclass: Take your Sustainability Knowledge to the Next Level
A 3-hour online masterclass providing a high-level overview of the key global, European and national regulations, standards and developments impacting sustainability governance, reporting and assurance, with an emphasis on areas highly relevant to accountants.
Virtual: 26 October, 8.30-13.30, €206.25 (€165.00 Chartered Accountants Ireland Member Price)
iQuest & Business Post Events The ESG Summit
In person: Thursday, 9 November, Radisson Blu Royal Hotel, Golden Lane, Dublin
Climate Finance Week Ireland 2023
In person and virtual: Monday, 20 November – Friday, 24 November
ICAEW: ICAEW Climate Summit
Virtual: 13-17 November
Innovate UK: Innovate UK's showcase for climate tech event in Northern Ireland
Series of 18 'showcase for climate tech' events across the UK until September 2025. Each event focuses on a specific net zero theme or technology area. The Northern Ireland event, run in partnership with Business in the Community NI, will take place in Belfast on 6 December 2023 and will focus on digital solutions for net zero.
In person: 6 December
Network for Chartered Accountants working on ESG projects
Are you a Chartered Accountant working in ESG or working on ESG-related projects? Would you like an opportunity to engage with other Chartered Accountants working in this space to share insights, challenges and opportunities?
Chartered Accountants Ireland now has a network to allow members working in sustainability/ESG to meet and discuss all matters of interest re ESG and accounting.
- 3rd or 4th Wednesday of every month
- Next: 25 October 2023
- 14.00-15.00/30
- Teams
If you would like to attend please email sustainability@charteredaccountants.ie
You can find information, guidance and supports to understand sustainability and meet the challenges it presents in our online Sustainability Centre.
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