Sustainability reporting: Exhaust all leeway to simplify implementation
GDV welcomes the fact that the German government is aiming for a 1:1 implementation of the European sustainability directive CSRD. The Bundestag should now use all the leeway available in the parliamentary process to achieve a design that minimises bureaucracy.
The CSRD Implementation Act is one of the Federal Government's most expensive legislative projects. The compliance costs for the economy are estimated at EUR 1.58 billion per year. However, numerous insurers estimate that the actual implementation costs could be many times higher. For small insurers in particular, the implementation of (first-time) sustainability reporting will be extremely cost-intensive and often not possible without external expertise, which is associated with additional costs. Larger, cross-border insurance groups with complex corporate structures might also incur above-average implementation costs, as the sustainability data of subsidiaries worldwide must be aggregated and processed.
It is therefore important to keep the implementation costs of the new requirements to an absolute minimum in the further process and to exhaust all existing leeway at the national level to achieve a design that minimises bureaucracy.
Group clause should be adopted
Insurers are positive about the fact that the possibility to use the so-called “group clause” for insurance companies has been included in the draft legislation without restriction. Due to the regulatory separation of lines of business, insurers in Germany are predominantly organised as insurance groups. These consist of separate corporate units such as a company for life insurance or a company for property insurance. Both control functions and reporting processes remain centralised at the group level. The group clause allows group companies to bundle their sustainability reporting at the parent company level.
Details of the insurers' proposals can be found in the statement on the draft legislation.
