Data Platform Support to SMEs for ESG Reporting and EU Taxonomy Implementation

Download or read book Data Platform Support to SMEs for ESG Reporting and EU Taxonomy Implementation written by and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Sustainable finance is a key factor in the economy's transition towards climate neutrality by 2050. Although non-listed small and medium enterprises (SMEs) account for 99% of EU enterprises, they are currently exempted from disclosing sustainability information under the new EU Taxonomy Regulation. However, SMEs could benefit from voluntary reporting through higher visibility, improved access to credit, benchmarking opportunities and improved monitoring of trajectories towards sustainability targets. Digital platforms can help SMEs in reporting but the current landscape for solutions targeting SMEs is fragmented. Underlying problems are a lack of standardization, non-harmonized metrics and limited incentives for SMEs to allocate time and resources for voluntary disclosures. A scanning of existing solutions based on desk-research and interviews with platform providers highlighted the need to communicate clearly to SMEs the added value of disclosure. Barriers for SMEs to voluntary disclose sustainability information could be reduced by shifting (high) costs away from them and towards data platforms or investors interested in the data. In addition, more focus should be put on the choice of metrics and their harmonization, auditing and data quality control, as well as on counter-acting green-washing.