Companies operating in the EU will have to report on their practices for the inclusion of persons with disabilities and other marginalised groups, due to the new EU Directive on Corporate Sustainability Reporting (CSRD).
The Directive was approved and published in the Journal of the European Union back in December 2022. The publication was followed by a long process of defining the set of reporting standards that companies must use regarding the sustainability of their environmental, social and governance practices. We advocated strongly to ensure that disability was substantially and meaningly reflected in the reporting standards.
On 9 June 2023, the European Commission’s services for the financial market published the first set of European Sustainability Reporting Standards.
The reporting requirements will be phased in over time. The first companies will have to apply the standards in financial year 2024, for reports published in 2025. Small and Medium Enterprises (SMEs) will only need to report as of 2026, with a further possibility to opt out voluntarily until 2028, and will be able to report according to separate, proportionate standards that will be developed next year.
What do companies need to report on disability?
Companies based in the EU will have to start reporting on the following:
- Diversity within the Board of Directors, showing the percentage by gender and other aspects of diversity that the undertaking considers relevant;
- The percentage of employees with disabilities, as well as an explanation of how this data was collected;
- An outline of the company’s specific policies aimed at eliminating discrimination and advancing diversity and inclusion, and whether disability is covered in these policies;
- Positive impacts of actions for customers and end-users, such as product design that improves accessibility for persons with disabilities or a commitment to making online services accessible to persons with disabilities;
- Whether or not all employees are covered by social protection, through public programs or through benefits offered by the undertaking, against loss of income after acquiring a disability;
- Steps the company takes to gain insight into the perspectives of its own workers that may be particularly vulnerable to impacts and/or marginalised (for example, women workers, migrant workers, workers with disabilities);
- The number of work-related incidents and/or complaints and severe human rights impacts within its own workforce;
- Examples of action for diversity: training on diversity and inclusion (including ethnicity considerations), targeted recruitment of underrepresented groups.
- Optionally, whether the undertaking has or is planning to make adjustments to the physical environment to ensure health and safety for workers, customers and other visitors with disabilities;
Will it make a difference?
While this EU Directive and its reporting standards do not strictly oblige companies to change the way they operate, they do hold them accountable for revealing their successes and shortcomings. This is likely to make companies think ahead about how to better include persons with disabilities in the workforce, including in management positions, and how to better design their services and products to be inclusive. The reporting standards also highlight to employers what areas they should be working on improving in the area of inclusion, and direct them towards what is expected of them in order to live up to their social responsibilities.
The new reporting obligations will also make it easier for us to keep track of good and poor performers in the open labour market when it comes to the inclusion of persons with disabilities.