Warsaw Stock Exchange publishes inaugural ESG reporting guidelines

Warsaw Stock Exchange (GPW) has published its first ESG reporting guidelines for listed companies - a 50-page handbook that was developed in collaboration with industry experts.

The backdrop: Poland’s consumer and business environment is increasingly concerned with environmental, social and governance (ESG) factors, although a lack of standardised reporting mechanisms is leaving investors confused about the true extent of their portfolio’s ESG performance. 

In December 2020, Warsaw Stock Exchange partnered with the European Bank for Reconstruction and Development (EBRD) to bring clarity to ESG reporting – calling on global sustainability-focused consultancy Steward Redqueen to help develop a set of guidelines for listed companies. The final document has now been published.

“These guidelines are not a new standard, they do not replace legal obligations, nor do they introduce new indicators,” explained Steward Redqueen partner Wouter Scheepens. “Rather, it is a roadmap that builds on internationally accepted reporting metrics and provides companies with a practical tool for setting up a focused reporting capacity.”

The EU’s Non-Financial Reporting Directive – implemented through Polish law since 2017 – is factored into the new guidelines, as is the Sustainable Finance Disclosure Regulation; the Taxonomy Regulation across the EU; and recommendations from the global Task Force on Climate-related Financial Disclosures. The guidelines also drew on inputs from listed companies, investors and consumers. 

A collated, one-stop-shop for ESG regulatory information: the document embodies a benchmarking tool for Polish companies at various stages of their ESG journey. “On a macro-level, these guidelines will inform the transition towards a more sustainable economy and raise the investment’s attractiveness of the region,” added Scheepens.

And for Poland’s increasingly responsible base of consumers and private investors, a clearer reporting paradigm will help retain purpose and value in their financial activity. This is in addition to the monetary gains to be made from an ESG-screened portfolio. 

“ESG integration helps companies to effectively manage long-term risks and create value for all stakeholders, including shareholders,” noted Izabela Olszewska, member of the GPW management board. She cited a GPW survey from October 2019, which revealed that nearly 90% of investors in Poland’s capital markets see a correlation between good ESG practices and high performance 

For EBRD, the project aligns with its broader Green Economy Transition approach – a green financing initiative that looks to combine economic development with low carbon emissions and long-term resilience. “In Poland, two thirds of financing deployed by EBRD in 2020 is green,” noted Grzegorz Zielinski, EBRD’s director for Central Europe and Baltics.

“We are glad to partner with GPW on work in relation to ESG disclosures and the creation of relevant guidance in terms of what and how issuers should disclose when reporting on ESG elements of their business,” he concluded.