Corporate Sustainability Reporting and Commitments: Effectiveness and Enforceability from EU to National Law

The chapter examines the legal framework surrounding corporate sustainability reporting, as mandated by EU law and, in its relevant transposition, national law. It focuses on the transformation of corporate ESG information, both for internal purposes and for the market, from non-financial reporting to corporate sustainability reporting framework. Specifically, the chapter underlines that the objectives of mandatory corporate sustainability reporting extend beyond merely enhancing the quantity and quality of ESG information available to investors and corporate financiers: its goals are also non-financial. Mandatory corporate sustainability reporting requirements speak to both financial and non-financial stakeholders while aligning with corporate and broader societal interests. Hence, the sustainable transition of companies is not left solely to the discretion of shareholders or lenders (duly informed about ESG factors). However, the effectiveness and enforceability of mandatory corporate sustainability reporting vary depending on the nuances of national regulations on corporate governance. From this perspective, the chapter will explore Italian law as a case study in order to verify if and to what extent relevant claims can be brought with regard to mandatory corporate sustainability reporting. In particular, it questions whether companies could be held liable for non-compliance with sustainability obligations, for declared but disregarded sustainability commitments, and for management decisions taken without abiding by sustainability principles.