ESRS Standard
ESRS Standard
36 The entity shall disclose its expected financial effects from Material risks and opportunities related to Pollution.
37 The information required by paragraph 36 supplements the disclosures required by ESRS 2 SBM-3 paragraph 48(d) about the current financial effects on the entity's financial position, financial performance and cash flows for the reporting period.
38. the objective of this disclosure requirement is to provide an understanding of the following:
(a) with respect to Anticipated financial effects due to material risks arising from Impacts and Dependencies related to Pollution, an understanding of how those risks have (or are likely to have) a material effect on the entity's financial position, financial performance and cash flows in the short, medium and long term,
b) Anticipated financial effects from material opportunities related to Pollution prevention and control.
39 The disclosures include the following:
(a) A quantification of the Anticipated financial effects in monetary terms before considering Actions related to Pollution or, if this is not possible without undue cost or effort, qualitative information. Quantification of the financial effects arising from Opportunities is not required if such information does not meet the qualitative characteristics of information (as defined in Installation C Qualitative Characteristics of Information of ESRS 1),
b) a description of the financial effects considered, the related impacts and the time horizons within which they are likely to occur, and
c) the critical assumptions used to quantify the Anticipated financial effects and the sources and degree of uncertainty of those assumptions.
40. the information provided in accordance with paragraph 39(a) shall include
(a) the proportion of net sales of products and services that are, or contain, Substances of Very High Conc ern (SVHCs),
b) the operating and capital expenditures incurred during the reporting period in connection with major Incidents and Deposits,
c) the provisions of environmental protection and remediation costs, e.g. for the remediation of contaminated sites, the reclamation of Landfills, the clean-up of Pollution at existing production or storage sites and similar actions.
41. the company shall provide all relevant background information, including a description of significant incidents and depositions where the pollution has had and/or is expected to have a negative impact on the company's cash flows, financial position and results of operations within short, medium and long-term time horizons.
Application Requirements (AR)
Application Requirements (AR)
AR 31. operating and capital expenditures related to Incidents and Deposits may include, for example:
(a) the costs of removal and remediation of the relevant air, water and Soil pollution, including environmental protection,
b) compensation costs, including the payment of fines and penalties imposed by regulatory or governmental authorities.
AR 32 Incidents may include, for example, production disruptions resulting from Supply chain and/or own operations that have caused Pollution.
AR 33 The company can provide an assessment of its related short-, medium- and long-term risky products and services, explaining how these are defined, how the financial amounts are estimated and what critical assumptions are used.
AR 34 The quantification of the Anticipated financial effects in monetary terms referred to in paragraph 38(a) may be disclosed in the form of a single amount or a range.
Examples from past practice
Examples from past practice
Examples serve only as an indication of how a disclosure requirement has been disclosed by other companies to date. Audited ESRS reports are not yet available. There is no guarantee of accuracy and completeness.
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