Sustainability Reporting Requirements for Large Companies Also Impact Small and Medium-Sized Enterprises

Learn about the sustainability requirements for companies in the Danish Financial Statements Act.

In Denmark, the Financial Statements Act requires large companies to report on sustainability in their annual reports. This may seem irrelevant to smaller companies, but that is not the case. Large companies must, among other things, account for their policies on social responsibility, their business model and how it affects environmental and social factors, as well as how specific risks are mitigated.

However, the EU aims to direct more private financial resources towards sustainable businesses by tightening reporting requirements. For example, they will require large companies to account for negative impacts from both the company itself and its value chains. This means that large companies will soon need to collect and report information about the sustainability of their supply chains. As a result, large companies will begin requesting specific data from all their suppliers, including smaller businesses. The first reports under this new setup will be due with the 2023 annual report.

In the coming years, the EU will also impose sustainability reporting requirements on smaller companies. This will be a "light" version of the reporting requirements for large companies. While the exact details are not yet known, you can start practicing sustainability reporting on Valified’s platform.

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