1. Introduction
In today's world, businesses need to be transparent about how they manage their impact on water and marine resources. This includes setting clear targets to ensure they are making progress in reducing their environmental footprint. The European Sustainability Reporting Standards (ESRS) require companies to disclose these targets to demonstrate their commitment to sustainability. In this article, we’ll break down what these targets should cover.
How companies can effectively disclose this information will be covered in another article.
2. Targets
Targets are specific goals or objectives that an organization sets to achieve within a certain timeframe. These targets help guide the organization’s efforts and measure its progress. For example, a company might set a target to reduce its water consumption by 30% over the next couple of years.
Companies are required to disclose the specific targets they have set related to water and marine resources. These targets help track the effectiveness of their policies and actions in managing environmental impacts:
Impact and risk management: Companies should set targets that address the management of significant impacts and risks in areas where water is at risk, including efforts to improve water quality.
Marine resource management: Targets should also cover the responsible use of marine resources, detailing the types and amounts of materials like seafood or deep-sea minerals the company uses.
Water consumption reduction: Reducing water use is a key target, especially in areas where water is scarce. Companies need to explain how their targets relate to these high-risk areas.
When setting these targets, companies might consider ecological thresholds—limits within which ecosystems can function sustainably. If they do, they should explain the methods used to determine these thresholds and how responsibility for meeting them is assigned within the company. Additionally, companies need to specify whether their targets are mandatory, based on legislation, or voluntary.
Companies must set and disclose specific targets for managing their impacts on water and marine resources, including reducing water consumption and responsibly using marine resources. These targets should address high-risk areas and may consider ecological limits, with companies clarifying whether the targets are mandatory or voluntary.
3. Conclusion
Setting and disclosing clear targets for managing water and marine resources is important for companies aiming to reduce their environmental impact. By being transparent about these targets, companies not only comply with regulations but also show their commitment to sustainability.
In an upcoming article, we will explore how companies can report on these disclosures. Subscribe to stay updated.
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Relevant Standards
ESRS E2
Disclosure Requirement E3-3 – Targets related to water and marine resources
20. The undertaking shall disclose the water and marine resources-related targets it has set.
21. The objective of this Disclosure Requirement is to enable an understanding of the targets the undertaking has adopted to support its water and marine resources-related policies and address its material water and marine resources-related impacts, risks and opportunities.
22. The description of the targets shall contain the information requirements defined in ESRS 2 MDR-T Tracking effectiveness of policies and actions through targets.
23. The disclosure required by paragraph 20 shall indicate whether and how its targets relate to:
(a) the management of material impacts, risks and opportunities related to areas at water risk, including improvement of the water quality;
(b) the responsible management of marine resources impacts, risks and opportunities including the nature and quantity of marine resources-related commodities (such as gravels, deep-sea minerals, seafood) used by the undertaking; and
(c) the reduction of water consumption, including an explanation of how those targets relate to areas at water risk, including areas of high water-stress.
24. In addition to ESRS 2 MDR-T, the undertaking may specify whether ecological thresholds and entity-specific allocations were taken into consideration when setting targets. If so, the undertaking may specify:
(a) the ecological thresholds identified, and the methodology used to identify such thresholds;
(b) whether or not the thresholds are entity-specific and if so, how they were determined; and
(c) how responsibility for respecting identified ecological thresholds is allocated in the undertaking.
25. The undertaking shall specify as part of the contextual information, whether the targets it has set and presented are mandatory (required by legislation) or voluntary.