Ljubljana, 24 September (STA) - The National Assembly passed on Tuesday amendments to the Auditing Act that bring new reporting requirements for companies regarding environmental, social and governance (ESG) issues in line with EU rules.
Under the changes, large as well as small and medium-sized companies which have issued securities that are traded on capital markets will have to append ESG reports to their financials as well.
The law also specifies what ESG reports must contain and governs auditors' commitments, according to Finance Ministry State Secretary Nikolina Prah.
Because ESG reporting is a major challenge for auditors as well as companies, the changes will be phased. Large companies will have to start reporting for financial year 2024, and SMEs for 2026.
Until 2028 auditors will provide just limited assurances about the reliability of information contained in ESG reports and procedures will be simpler.
Detailed reporting rules will be finalised in standards that the EU Commission is expected to adopt in 2026. "Based on available information, we expect shorter reports and certain exemptions for smaller companies," said Prah.
Coalition deputies welcomed the legislation as a step towards greater social justice and protection of the environment, arguing that this will improve investor trust and boost competitiveness.
The conservative opposition meanwhile warned about excessive red tape, fearing that it will undermine rather than improve competitiveness. The Democrats (SDS) abstained and New Slovenia (NSi) was the only party that voted against.
