The ESG Act affects domestic companies widely

By: Trademagazin Date: 2024. 01. 16. 12:54

The domestic ESG law, effective from January 1, 2024, will have a great impact on the life of domestic businesses. Those who act on time can gain an advantage, those who are late will be at a huge disadvantage. Business leaders have to learn many new acronyms so that they don’t hear them for the first time in an important meeting.

This year, the domestic ESG law (the main regulation of corporate sustainability, which formulates the E environmental, S social and G corporate management guidelines) aligned with the European Union’s CSRD regulation came into force. Already in 2024, the effective decree may directly represent a serious task for large companies listed on the stock exchange or active in the financial field. Also indirectly to SME suppliers of companies directly affected by the regulation.

The Hungarian legislator, together with EU regulations, imposes an ESG reporting obligation, in a new, more extensive and transparent form, for those large companies of financial and public interest for the 2024 business year, which employ over 500 people and whose balance sheet total reaches or exceeds 10 billion forints and have a sales revenue of at least 20 billion. Two of the three parameters just listed must be met in order to fulfill the reporting obligation. Public interest means that the company is listed on the stock exchange, can be freely traded or operates as a financial institution.