Financial Crime World

Financial Reporting and Transparency in Luxembourg: ESMA Sets Priorities for 2023 Annual Reports

The European Securities and Markets Authority (ESMA) has released its annual Public Statement setting out the European Common Enforcement Priorities (ECEPs) for 2023 annual financial reports of issuers admitted to trading on European Economic Area (EEA) regulated markets. The statement highlights key areas of focus, including:

  • Issuers are reminded to consider the impact of climate-related risks and opportunities in their financial statements.
  • ESMA invites issuers to pay attention to best practices relating to disclosures of climate-related matters in financial statements.
  • The CSSF strongly encourages issuers to follow these recommendations, which include providing information on:
    • Alignment of activities with regard to climate change mitigation and adaptation objectives.

Macroeconomic Environment in Focus

  • ESMA notes that the current economic situation presents significant challenges for issuers, and therefore, it is essential for them to provide clear and transparent financial reporting.

Non-Financial Statements Under Scrutiny

  • ESMA also emphasizes the importance of non-financial statements, particularly in light of the entry into force of the Corporate Sustainability Reporting Directive (CSRD) from 1 January 2024.
  • Issuers are required to provide information on:
    • Environmental performance
    • Climate-related targets
    • Actions taken to address climate change

Alternative Performance Measures Under Review

  • APMs continue to be an important area under the CSSF radar.
  • ESMA reminds issuers that APMs should be treated in line with the ESMA APM Guidelines available on its website.

Conclusion

The ECEPs for 2023 annual financial reports highlight key areas of focus, including climate-related matters, macroeconomic environment, non-financial statements, and alternative performance measures. It is essential for issuers to provide clear and transparent financial reporting in light of the current economic situation and the entry into force of new regulations.

Additional Information

For further information, please read the fullest CSSF publication available on their website at www.cssf.lu/en/.