German companies support Brussels’ climate change mitigation policy
German companies, led by the private sector, adopt European Commission plans for a sustainable low-carbon economy. This is the message of a representative OMFIF survey on the challenges of sustainable development for large companies in Germany. The study, encompassing the views of 104 unlisted companies and 32 listed companies from all economic sectors, was launched in Berlin on June 17.
The survey is the first major effort in Europe to assess the reaction of businesses to the Commission’s plans announced in April for a directive on corporate sustainability reporting, a central part of the European climate change mitigation agenda. According to the survey, unlisted German companies are particularly confident: three quarters of those questioned expect their company to gain at least the same advantages and disadvantages from Brussels policy.
“German companies congratulate Brussels in advance for regulations on greater transparency in sustainability,” says Janine von Wolfersdorff, project manager and member of the OMFIF advisory board. “Companies say that developing sustainability strategies is the most important task after the coronavirus crisis. Politicians should support these companies in the coming transformation. ‘
“German companies are supporting European projects in a way that suggests that they will set a benchmark in efforts for a greener Europe,” said David Marsh, President of OMFIF. “And that takes place three months before an election which could bring the Greens into the next government in Berlin.”
Half of unlisted companies say the EU measures will improve their profitability. The results show that, for unlisted companies, the coronavirus crisis and its consequences remain by far the most important challenge for the next 12 months (45%), followed by sustainability requirements (29%). Slightly lower proportions of listed companies – 29% and 25% – cite these two issues as their biggest and second biggest challenges.
The survey was carried out by the German pollster forsa by phone and online between May 5 and June 4. The project was launched in cooperation with the Association of German Banks (BdB), the German Accounting Standards Committee (DRSC), the Bertelsmann Foundation, the New Institute, Flossbach von Storch, Andersen and the Luxembourg Stock Exchange. It was supported by the German Ministry of Finance and the Luxembourg Embassy in Berlin.
Christian Ossig, CEO of BdB, declares: “German banks will live up to their responsibilities in terms of climate protection. The fight against climate change can only be accomplished if banks play their role to the full.
Listed companies are a little more skeptical of Brussels climate policies. Almost 60% expect at least the same economic advantages and disadvantages as a result of the EU’s green deal; a third see a lot of benefits.
Surprisingly enough, three quarters of listed companies welcome the EU’s desire to extend non-financial reporting to their sector. However, only half of these companies had heard of concrete plans.
The survey provides new information on “taxonomy reports” among German listed companies, describing and ranking the activities on which companies must first report from 2022 to comply with environmental policies. The report highlights the financing needs of German companies, for which they expected green compliance to cost more, the recommended changes in the financing system, the effects on the balance sheet of the effects of sustainable investment and the perspectives of “green accounting” and “green control”.