European Court of Auditors, Rapid Case Review: Reporting on Sustainability: A Stocktake of EU Institutions and Agencies, 2019

The European Union is committed to implementing the 2030 Agenda for sustainable development and its 17 Sustainable Development Goals (SDGs). This review takes stock of the status of reporting on the achievement of the SDGs and sustainability at EU level as well as reporting by individual EU institutions and agencies.

With Directive 2014/95, the EU made reporting on non-financial information on certain minimum sustainability information obligatory for certain large companies. With regard to reporting in the public sector and by state-owned companies, examples can be found in certain Member States.

Sustainability reporting is the practice of measurement, disclosure of information and accountability to internal and external stakeholders concerning organisational performance towards the goal of sustainable development. Sustainability reporting is both a management and an accountability tool. It involves reporting on how an organisation takes into account sustainability issues during its operations, and on its environmental, social and economic impacts. A sustainability report also presents the organization’s values and governance model, and demonstrates the link between its strategy and its commitment to a sustainable global economy. Increasingly, companies’ sustainability reports take into account the SDGs.

This review shows that the Commission does not report on the contribution of the EU budget or EU policy to achieving the SDGs. One exception is the area of external action, where the Commission has started to adapt its performance reporting system in relation to SDGs and sustainability. The Commission has recently published a reflection paper where it describes selected Commission policies related to the SDGs. The EU’s statistical office (Eurostat) publishes an overall description of the “progress towards the SDGs in an EU context”. However, this does not attempt to measure the contribution of the EU’s policies and budget to the 2030 Agenda.

This review also takes a look at what EU institutions (other than the Commission) and EU agencies do in the area of sustainability reporting. It is found that one EU institution, the European Investment Bank, and one EU agency, the European Union Intellectual Property Office, publish a sustainability report. Other EU institutions and agencies collect some information related to sustainability, and sometimes publish it, but this is often piecemeal and incomplete and does not cover all aspects of sustainability. The information mainly relates to how the running of the organisations affects sustainability rather than how they have considered sustainability in their overall strategy and operations.

Four challenges for sustainability reporting in EU institutions and agencies are identified:

– Developing an EU strategy post-2020 that covers the SDGs and sustainability;

– integrating sustainability and SDGs into the EU budget and the performance framework;

– developing sustainability reporting in EU institutions and agencies; and

– increasing the credibility of sustainability reporting through audit.

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