Sustainability/ESG bulletin, Friday 8 March 2024

In this week’s Sustainability/ESG bulletin, read about the final progress report on the Climate Action Plan 2023, the ‘4D’ megatrends in Department of Finance economic outlook, the announcement of funding of €34 million for a biodiversity data project, and the launch of a new client advisory panel on Sustainability and ESG by Enterprise Ireland. Also covered is the launch of a circular economy consultation in Northern Ireland and climate measures in the UK Spring Budget, as well as European and global sustainability developments, and the usual articles, resources and events.

IRELAND

Final progress report on the Climate Action Plan 2023

The Government has published the final progress report on the Climate Action Plan 2023. The Plan was the second annual update of its kind and the first to be prepared under the Climate Action and Low Carbon Development (Amendment) Act 2021. It tracks the actions that were due for delivery and reporting in Q4 2023 and puts the overall implementation rate for the plan at 65 percent, with 188 of 290 actions set out for the year completed.

The report calls for the uncompleted actions to be urgently delivered and for challenges to climate action implementation to be dealt with. The delivery rates of committed actions for the year were not equal to the actions set out in the Climate Action Plan, which creates challenges for legally binding EU and national emissions reduction targets.

A public consultation on the Climate Action Plan 2024 is open until 5 April. This Plan builds on the Climate Action Plan 2023 by refining and updating the measures and actions required to deliver the carbon budgets and sectoral emissions ceilings.

4D megatrends in Department of Finance economic outlook

The Department of Finance has published a presentation by Chief Economist, John McCarthy, on Economic developments and outlook -short- and longer-term prospects for the Irish economy. The presentation includes, among other things, an analysis of the “Mega-trends” (the ‘4Ds’): demographics, decarbonisations, digitalisation and deglobalisation. The forecasts, which were set out by the Department of Finance in its autumn forecasts (Economic and Fiscal Outlook, October 2023), show the trajectory of carbon pricing and the need to mobilise new revenue streams as a result of the transition to carbon neutrality.

Funding for biodiversity data project announced

The Department of Housing, Local Government and Heritage has announced funding of €34 million for a project that aims to transform Ireland’s approach to biodiversity data. Biodiversity contributes an estimated €2.6 billion each year to the Irish economy through ecosystem services – such as water or air quality, soil fertility or pollination services – as well as benefits to human quality of life and mental health. Led by the NPWS and supported by the Department of Agriculture, Food and the Marine and Coillte Nature, the new LIFE Strategic Nature Project will bring biodiversity information from multiple sources together to enable enhanced decision-making and support better tracking of progress towards targets.

Ireland's human rights obligations periodic review publishes

The Department of Foreign Affairs has announced that the expert body responsible for examining Ireland’s implementation of the human rights obligations has published its Concluding Observations on the fourth periodic report of Ireland. The report, issued by the UN Committee on Economic, Social and Cultural Rights, was published following Ireland’s engagement in a review process in February which took account of Ireland’s progress in realising economic, social and cultural rights since the last review in 2015. Progress included adopting the Gender Pay Gap Information Act 2021, Pathways to Work (2021-2025), the Roadmap for Social Inclusion (2020-2025), and others. Recommendations on where further advancements can be made included advancing gender equality, improving data collection, furthering the business and human rights agenda, and combatting discrimination.

Enterprise Ireland launches new client advisory panel on Sustainability and ESG

Enterprise Ireland has launched new client advisory panels, including on Sustainability and ESG, to examine practical responses to the challenges and opportunities faced by Irish businesses within a rapidly evolving global trading environment. The panels, which will cover the four themes of Scaling, Entrepreneurship, Sustainability & ESG and Local Enterprise, bring together entrepreneurs and senior business leaders to advise on Enterprise Ireland strategy and service delivery.

NORTHERN IRELAND

Circular economy consultation launches in UK

A new consultation has been launched by the Department of Agriculture, Environment and Rural Affairs on how Northern Ireland can improve recycling and waste management to achieve that ambition. Entitled ‘Rethinking Our Resources: Measures for Climate Action and a Circular Economy in NI,’ the 12-week consultation has 26 proposals for change, including the possibility of recycling a wider variety of materials in kerbside bins, enhancing food waste collections and reducing the amount of residual waste allowed. The consultation is open until 5pm on 30 May 2024.

Funding for offshore wind and carbon capture in UK Spring Budget 2024

An extra £120 will be allocated to the Green Industries Growth Accelerator to build supply chains for offshore wind and carbon capture and storage, it was announced this week, as UK government published its ‘Budget for Long-Term Growth’. Find more coverage of the UK Spring Budget by Chartered Accountants Ireland here.

EUROPE

• (From our friends in Accountancy Europe): A report has found that the majority of SMEs’ green finance practices are self-financed, with only 35 percent of the 1,232 surveyed having made use of external financing in sustainability investments. The report, published by the EU Platform on Sustainable Finance in January 2024, investigated how the EU’s Taxonomy and sustainable finance framework are helping financial and non-financial actors transition to net zero. Its dedicated section on SMEs presented findings and market trends on SMEs’ sustainable transition practices and show that a significant majority of the surveyed SMEs (58 percent) have already invested in sustainable projects. There are variations across sectors: 69 percent of manufacturing companies, 51 percent of services firms and 54 percent of trading companies have done so, with investments increasing with the size of the SME.

   

• The EU Parliament and Council have reached provisional agreement on new rules that ban products made with forced labour from the EU market. The new regulation would create a framework for enforcing this ban, including through investigations, new IT solutions and cooperation with other authorities and countries. The forced labour regulation focuses on products and will not place additional due diligence requirements on companies that do not use forced labour in their supply chains; however, it is often associated with the Directive on Corporate Sustainability Due Diligence (CSDDD) that was provisionally agreed between Parliament and Council, but that has so far not been given final approval from the Council.

   

• The European Parliament and Council have also reached a provisional agreement on revamped rules to reduce, reuse and recycle packaging, increase safety and boost the circular economy. The new measures aim to make packaging used in the EU safer and more sustainable, by requiring all packaging to be recyclable, minimising the presence of harmful substances, reducing unnecessary packaging, boosting the uptake of recycled content and improving collection and recycling. It sets packaging reduction targets (5 percent by 2030, 10 percent by 2035 and 15 percent by 2040) and requires EU countries to reduce, in particular, the amount of plastic packaging waste. Parliament and Council need to formally approve the agreement before it can enter into force.

GLOBAL

• The fourth annual IFAC and AICPA & CIMA State of Play of global sustainability disclosure and assurance practice has published. The State of Play: Sustainability Disclosure and Assurance benchmarking studies captures and analyses the extent to which companies are reporting and obtaining assurance over their sustainability disclosures, which assurance standards are being used, and which companies are providing the assurance service. The publication shows that nearly all companies reviewed report at least some ESG information and an increasing majority of companies obtained assurance on at least some of that ESG information. Only three jurisdictions reviewed had assurance rates of 100 percent, however, indicating that there is still work to be done.

   

• Also from IFAC: In January 2024, IFAC's Small- and Medium-Sized Practices Advisory Group (SMPAG) heard a presentation about the journey an Italian SMP, Attolini, Spaggiari & Associati, has taken in becoming a B Corporation. Find out more here.

   

• A recently published update to the ‘Oxford Offsetting Principles’ is calling for ‘a major course-correction’ in carbon markets. The Principles, first published in 2020 by the University of Oxford, outline how offsetting needs to be approached to help achieve a net zero society. The revised Principles underscore the core components of the original Principles, calling for a major course-correction in carbon markets and offsetting practices, while also clarifying aspects of the Principles for net zero alignment in areas where authors felt further detail would be beneficial to users. Find out more here

Technical RoundUp

(From our colleagues in Professional Accounting)

Did you know?

Did you know that this week in Ireland was National Tree Week? Many events around the country were supported by the European Commission, which has a #3BillionTrees Pledge by 2030. The EU also has a new For Our Planet campaign, which aims to encourage citizens and civil society to take action for our planet, including by planting trees.  

Calling our members in the Energy Sector

Business For Biodiversity Ireland is building on its successful multi-sector Community of Practice (CoP) of businesses coming together to share, evolve and drive change toward a Nature Positive future. The national platform is now convening sector-specific CoPs for 2024 - starting with the Energy Sector.  If you are an energy provider, regulator, renewable energy organisation / expert, community group, NGO or SME specialising in the area of energy and carbon emissions, you can get involved by finding out more here: https://businessforbiodiversity.ie/energy-sscop/

Articles

• NESC, Making Nature Visible: What Can Natural Capital Accounting Do For Us?
  Following the publication by the National Economic and Social Council (NESC) of Natural Capital Accounting: A Guide for Action, this in-person event will discuss the potential of natural capital accounting in Ireland.
  12 March, 08:30 - 13:30 GMT, In-person, Dublin Royal Convention Centre
• InvestNI, Supply Chain Conference 2024
  Invest Northern Ireland is hosting a free event to help businesses navigate current supply challenges and future-proof their supply chains. Panel discussions and case studies will showcase industry learnings and knowledge on the themes of sustainability, digitisation and supply chain improvements.Industry experts will also outline the steps you can take to stay ahead of the curve in your industry.
  12 March 2024, 9:30am - 16:15, Venue: City Hotel, Armagh

• ICAEW, The EU Carbon Border Adjustment Mechanism (CBAM) - what does it mean for UK businesses?

  What will the EU's Carbon Border Adjustment Mechanism mean for UK businesses exporting to the EU?
  13 March, 12:00 - 13:00 GMT, Zoom

• CAANZ, Sustainability Seminar 2024 AU
  The Sustainability Seminar 2024 is designed to elevate your knowledge and confidence in tackling the sustainability challenges faced by accounting, business and finance professionals every day. With sessions designed to enhance your understanding of developments and future trends, we’re shifting the conversation from discussions around conceptual climate risk to embedding sustainable business practices at every level, making sustainability part of business as usual. 
  Tuesday 19 March 2024, 10:00am to 2:00pm AEDT, Virtual (Zoom)

• CAANZ,Climate Disclosures Seminar 2024
  This two-day seminar will assist delegates to understand the complex landscape of climate disclosures. In 2026, Group 2 organisations will commence reporting on their climate metrics, so finance professionals and executives need to understand now what will be required, and where to begin.

  Wednesday-Thursday, 20-21 March 2024, Virtual

• Sustainable Energy Authority of Ireland, The Energy Show 2024
  Join SEAI for a host of informative seminars and industry talks as well as over 100 exhibitors from the sustainable and renewable energy sector. Of note: SEAI’s grants and supports for business - The SME Business Grant Briefing on Wednesday at 2-2:45pm at the Energy Theatre 
  20-21 March, In person. RDS, Dublin

• A4S Sustainability In Action Webinar: Capitals Accounting
  An interactive webinar exploring various aspects of capitals accounting and how it is being applied in practice. The discussion will explore the information needed to tackle a range of impacts.
  28 March, 08:00

• Accountancy Europe and others How can company boards lead the sustainability transition? The event will also draw on the recent Accountancy Europe, ecoDa and ECIIA publication ESG Governance: questions boards should ask to lead the sustainability transition which sets out practical questions that boards should consider in their efforts on ESG, sustainability transition planning, delivery on sustainability objectives and limiting greenwashing risks.
  10 April, 10:30-12:00 CET, Virtual

• Chartered Accountants Ireland ESG Masterclass: Take your sustainability knowledge to the next level (ROI/NI)
  Masterclass designed for all professional accountants working in business or practice, wishing to consolidate their knowledge and understanding of the sustainability regulatory, reporting and assurance landscape.
  18 April, 08:30 – 13.00, Virtual

• ICAS Sustainability Summit
  This event, hosted in association with Accounting for Sustainability (A4S), will bring together sustainability experts and forward-thinking business leaders to explore how we can accelerate the vital business changes needed to save our planet. A specialist line-up of speakers and panellists will delve into the future of sustainable business, the role of technology in the climate transition and the evolving sustainability reporting landscape. The summit also marks the launch of ICAS’ sustainability business network – a collaborative community where professionals can share and benefit from sustainability-related insights.
  In person, Edinburgh, 25 April 2024.

• National Sustainability Summit 2024
  Dates: May 28-29
  Locations: RDS

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.

• Next: Wednesday, 27 March, 14:00-15.30
• 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.