EU auditors: Mind the gap in EU reporting on sustainability

EU auditors: Mind the gap in EU reporting on sustainability
Credit: ECA

In a new audit report the European Court of Auditors delivers scathing critique of how the EU institutions report on United Nations´ Sustainable Development Goals. According to the auditors the EU hardly reports on sustainability, despite a legal requirement to do so, because the building blocks for meaningful reporting are largely not yet in place.

At a press briefing in Brussels on Wednesday (12 June), Eva Lindström, the member of the European Court of Auditors responsible for the report, described it as a review, rather than an audit, aiming at establishing facts and pointing out challenges, but without any Commission reply to the findings and recommendations.

“The reports we publish provide the basis for the European Parliament and the Council to hold the Commission to account. When the Parliament asks what the Commission has done in reporting on sustainability, this review will provide the answers,” she said.

“Citizens want and need reliable information on how the EU contributes to sustainable development in areas such as climate change. Given the EU’s commitment to the SDGs, we would expect the Commission to be able to report on the results achieved.”

The goals were adopted by all United Nations Member States in 2015 and sets an agenda to be achieved by 2030. At its heart are the 17 Sustainable Development Goals (SDGs), which are an urgent call for action by all countries - developed and developing - in a global partnership.

They recognize that ending poverty and other deprivations must go hand-in-hand with strategies that improve health and education, reduce inequality, and spur economic growth – all while tackling climate change and working to preserve our oceans and forests.

Through sustainability reporting – also known as corporate social responsibility or non-financial reporting – an organisation publishes information about its economic, environmental and social impact. Sustainability reporting is embedded in the EU treaties.

A sustainability report also presents its values and governance model, as well as demonstrating the link between its strategy and its commitment to a sustainable global economy.

EU law requires large public-interest entities to report on sustainability, currently around 7 400 listed companies, banks, insurance companies and other entities identified by Member States. 2018 was the first year they had to do it.

Asked by The Brussels Times if it was not too early to review the reporting requirements, Eva Lindström replied that the EU committed itself to the SDGs already in 2016. “It is reasonable to expect that there by now would be reporting in place on how the EU’s budget and policy contribute to implementing the SDGs and to look at reporting by the EU.”

In the review, illustrated with figures and graphs, the auditors examined whether the Commission leads by example in reporting on sustainable development and assessed whether pre-requisites such as a strategy with targets to report on are in place. They also checked whether other EU institutions publish sustainability reports.

The auditors carried out a survey of 12 EU institutions and 41 agencies. “We found that there is no overall EU strategy that covers the SDGs up to 2030,“ said Eva Lindström. “All current strategies or frameworks from the Commission end by 2020 while the SDGs go until 2030. So, I can only say ‘mind the gap!’”

The Commission’s statistical office, Eurostat, presents information relating to the SDS, she continues, but it does not measure the contribution of the EU budget or policy to achieving the goals. With the exception of the area of externa action, the Commission has not yet integrated the reporting on the SDGs in its performance reporting.

Major challenges for the Commission would therefore be to develop an EU strategy for the years after 2020 that covers the SDGs and to integrate sustainability into the EU budget and its performance framework.

M. Apelblat

The Brussels Times

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