Need to know abbreviations in ESG
Sustainability in itself can be very difficult to navigate through, and the abbreviations doesn’t make it any easier.
And these days it only seems as if there’s a new one to know a week.
To help you out a bit, we’ve made you a list of some of the “need to know” abbreviations that are used in the sustainability field.
EPR - Extended producer responsibility
Producers have to take responsibility of their products, both how the product is made, how it’s brought onto the market, and when the end-user disposes it.
Different countries have different ways of enforcing it, and most require some kind of reporting and labelling to help ease recycling.
To ensure that consumers know how to recycle their waste correctly, more countries have started and are implementing specific labelling requirements indicating correct disposal of packaging waste and textiles.
Examples include:
Infotri on packaging and textiles in France
Guidance and material indication in Italy
New EPR rules on textiles in the Netherlands
Read more about EPR updates here.
EUDR - EU Deforestation Regulation
EUDR will replace the EU Timber Regulation (EUTR).
This was agreed upon on December 6, 2022.
The EUDR prevents companies from selling materials linked to deforestation and forest degradation in the European market as well as exporting them from the EU.
It sets due diligence rules for organizations selling specific raw materials or products.
These include (for now) soy, beef, palm oil, wood, cocoa, coffee, and rubber.
EUTR - EU Timber Regulation
EUTR is the existing regulation from the EU set in place to fight illegal trade with timber and wood-based products.
Companies that bring wood-based products onto the European market are obligated to go through a risk evaluation and risk prevention process to make sure the timber and wood do not come from illegal sources.
EUTR has been in effect for almost a decade but will be replaced by the EUDR.
CSRD - Corporate Sustainability Reporting Directive
CSRD is the EU’s new reporting directive that replaces the non-financial reporting directive (NFRD).
CSRD requires companies to report their impact on society and the environment to a larger extent than it was the case with NFRD.
It will be implemented over a few years depending on company size – listed SMEs won’t be included before 2026 (first report in 2027), and they can opt out until 2028.
The European Sustainability Reporting Standards (ESRSs) were adopted recently - you can read more about that here.
NFRD will be in force until CSRD takes effect.
CSDD/CSDDD - Corporate Sustainability Due Diligence (Directive)
On February 23, 2022, the European Commission adopted the CSDD proposal.
The aim of the proposal is to advance sustainable and responsible corporate behaviour.
Companies will have to identify impacts on their human rights and, if necessary, prevent or mitigate.
It relates to areas such as human rights, child labour, exploitation of workers, and the environment.
CSDD will introduce common and unified demands to European companies, so they can prevent a fragmented approach to due diligence.
You will most guaranteed stumble upon most, if not all, the abbreviations in the future, if you haven’t done so already.
So, go ahead and save this newsletter, so you always have access to the information you need.
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