The significant risk of greenwashing introduced by the latest European Financial Reporting Advisory Group (EFRAG) draft guidance raises concerns for Civil Society Organisations.

The draft text addresses the requirement for companies to report on Climate Transition Plans compatible with the 1.5C goal outlined in the Paris agreement. However, through loose interpretation of the law it would allow companies to set targets aligned with a  3°C scenario and still claim to be compliant with requirements included in the Corporate Sustainability Reporting Directive (CSRD).

“The current version of the guidance sets a dangerous precedent for future practice and policy development in the realm of Climate Transition Plans. Amendments to the text are required in order to safeguard the overarching policy objectives of  Climate Transition Plans in the context of the green transition and ensure consistency among key files that make up the sustainable finance framework” said Mariana Ferreira, Sustainable Finance Policy Officer at WWF EU.

By signing this statement, Civil Society Organisations urge EFRAG to take decisive action to strengthen the guidelines in order to safeguard the future of the EU Green Deal and the Sustainable Finance Framework.

Civil Society Statement on EFRAG’s published Draft Climate Transition Plan Guidance