ESG Reporting After the Changes

In Poland, the realm of ESG reporting is currently a focal point of intense discussion within the public interest entity (PIE) audit sector. Roman Seredyński, managing partner at UHY Poland, attributes this heightened attention to the prevailing geopolitical climate and, notably, Donald Trump's past decision to withdraw the US from the Paris Agreement on climate change. These events have triggered a cascade of reactive and, at times, ill-considered policy adjustments at both the European Union and national levels.

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The geopolitical situation and Donald Trump's decision to withdraw the USA from the Paris Agreement on climate change have caused a wave of nervous and ill-considered decisions at both the European Union and Polish levels.

The overall assessment of the Omnibus package by auditors is far from uniform. A significant concern voiced by many is the volatility of sustainability reporting regulations. This instability erodes trust not only in legislative bodies but, more critically, in the very objectives that ESG reporting aims to achieve. Paweł Zaczyński, a partner at Grant Thornton, observes that the recent changes have transformed sustainability reporting into an additional regulatory burden for those still obligated to comply. This has led some companies, previously inclined towards voluntary ESG reporting, to reconsider their commitment, questioning the utility of such efforts when the comparative data landscape is subject to frequent alteration.

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Sustainability reporting, after the changes brought by Omnibus, becomes an additional regulatory obligation for those who still have this obligation.

Interestingly, despite the introduction of provisions allowing for the early application of the Omnibus package and exemptions from reporting for the 2025 fiscal year, a majority of eligible firms opted not to utilize this relief. This suggests that the drastic legal changes may not have been as necessary as initially perceived, and companies that had already invested in sustainability reporting recognized its inherent added value. However, this investment extends beyond the reporting entities themselves. Audit firms and certified auditors have also poured significant time, resources, and capital into developing specialized competencies. Consequently, Poland now boasts several hundred certified auditors with over 80 hours of training in sustainability attestation, starkly contrasting with the approximately 60 entities currently mandated to report.

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This shows that such drastic changes in the law were not necessary at all, and companies that have already invested in preparing sustainability reporting see added value in it.

Zaczyński further critiques certain simplifications within the sustainability reporting framework, particularly concerning social aspects and employee rights. He suggests that sustainability reporting should have been allowed more time to mature before implementing simplifying changes. Conversely, he views the delay in mandating ESG reporting for previously non-reporting entities positively, advocating for their entry into reporting only after the regulatory environment stabilizes. Despite the current legislative flux, ESG represents a lasting shift in corporate governance, and while the Omnibus package alters the pace and scope of obligations, the overarching trend remains.

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I think it was worth giving sustainability reporting time to solidify and, based on that, calmly implement changes regarding the simplification of standards and elimination of ambiguities.