Spain: Sustainability reporting - Updated technical guidance on the audit committees of public-interest entities

Spain’s financial regulator the CNMV has updated its technical guidance on the audit committees of public-interest entities.

The main changes relate to annual sustainability reporting and are as follows:

1. Changes of terminology to be in line with the EU’s Corporate Sustainability Reporting Directive (CSRD): the term ‘sustainability reporting’ is used to refer to information on ESG while ‘non-financial reporting’ is left as a more general term that would include reporting on management, corporate governance, directors’ pay and risk management systems.
    
2. Clarification of the roles of the audit committee and of the sustainability committee that companies may elect to form: the importance of appropriate coordination between the two committees.
    
3. Assurance: the recommended practices regarding the auditor are extended to providers of assurance on sustainability reporting.
    
4. Knowledge: committee members are advised to have sustainability-related knowledge.
    
5. Training: sustainability is included among the recommended components of periodic training programmes for committee members.

Although the CSRD has not yet been implemented in Spain, the guidance considers its provisions (already in force) and the draft Spanish bill for its transposition.

The CNMV’s press release and new updated guidance is here and here (in Spanish).