Only 5% of Romania’s major companies transparently report sustainable practices

Starting from January 1, 2025, in line with the new EU directive, companies in Romania with over 500 employees are obligated to annually report transparently on sustainability and community investment practices. According to statistics, only 5% comply with this reporting requirement at this moment.

For instance, out of the 750 large companies operating in Romania falling under this category, only 43 have published sustainability reports for the 2022 financial year.

These reports are evaluated by The Azores Sustainability & CSR agency using the Romania CST Index scorecard, which includes 11 categories, 78 sustainability indicators, and 201 datapoints. The final score for each company is weighted by industry, resulting in a percentage (not a sum of points). The methodology aligns with international practices. Companies scoring over 80% receive Gold Level distinction, those with over 70% enter the Silver Level, and those surpassing 50% fall into the Bronze Level.

The rankings will be announced on Tuesday, December 19, in Bucharest, during the eighth edition of the Best Practices in Corporate Sustainability event at the GlobalWorth Nord Events Center, hosted by Teodora Tompea.

The conference, themed “Sustainability is Unstoppable. So are you!” represents the most significant assessment of sustainability and corporate responsibility in Romania.

“The Romania CST Index is a comprehensive analysis, unique in Romania, evaluating companies’ sustainability indicators concerning performance and transparency in areas such as climate change, governance, diversity and anti-corruption policies, employee responsibility, responsible marketing, or value chain. Despite over 750 companies with more than 500 employees in Romania, a small percentage publishes sustainability reports,” says Alina Liciu, Managing Partner at The Azores.

Starting from 2024, companies under the NFRD will have to collect information according to the new Corporate Sustainability Reporting Directive (CSRD), increasing the complexity of sustainability reports. Reports prepared in this way will be published from 2025 onwards. Furthermore, for the financial year 2025, all companies meeting at least two of the following three criteria: over 250 employees, a turnover of 40 million euros, and/or total assets of 20 million euros will be obliged to prepare a sustainability report.

“The new EU Directive on Corporate Sustainability Reporting (CSRD) amends the current Non-Financial Reporting Directive (NFRD) and applies to a larger number of European entities, obliging them to report according to common EU standards (European Sustainability Reporting Standards – ESRS) from January 1, 2025 (for the year 2024). In addition, reports will need specialized auditing, and sustainability indicators must be digitally labeled for easy searchability by search engines,” says Alina Liciu, Managing Partner at The Azores.

The CST Index for Romania is essential for several reasons, providing a structured and standardized way to assess companies’ sustainability performance by industry standards. It allows companies to compare their reporting level with international standards and the performance and transparency of other industry players, including top performers. Investors increasingly consider environmental, social, and governance (ESG) factors in decision-making processes, and a sustainability index can guide their investment decisions by providing concise information on ESG management and performance. The index also emphasizes increasing transparency on a wide range of sustainability indicators.

The top-performing companies in the Romania CST Index 2023 will be decided based on the analysis of sustainability reports, following the 11 categories, 78 sustainability indicators, and 201 datapoints. Companies achieving over 80% of the total score will receive Gold Level recognition, those with over 70% will enter the Silver Level, and those surpassing 50% will fall into the Bronze Level. The Romania CST Index aligns with the most important international standards or references used in the sustainability industry.