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Gender Pay Gap legislation is signed into law; the Pensions Authority publishes a draft code of practice for trustees of occupational pension schemes and trust RACs; a report shows that the accounting and business sector form the largest portion of new start-ups in 2021; and the private sector in Northern Ireland experiences its fastest growth in seven years. Gender Pay Gap legislation signed into law Legislation requiring businesses to report on pay and bonus differences between male and female employees was signed into law last week by President Michael D Higgins. Under the Gender Pay Gap Information Bill, which was originally published in April 2019, organisations with 250 or more employees will have to publish certain details of pay and bonuses for men and women, including: The mean and median gap in hourly pay between men and women The mean and median gap in bonus pay between men and women The mean and median gap in hourly pay of part-time male and female employees The percentage of men and of women who received bonus pay The percentage of men and of women who received benefits in kind. The legislation also requires publication of the reasons, in the employer’s opinion, for any gaps and also the measures (if any) that the employer is taking or proposes to take to eliminate or reduce them. Employers with fewer than 250 employees will have until the second anniversary of the making of the first regulations to publish details, while employers having 150 employees have until the third anniversary. There will be no requirement for employers having fewer than 50 employees to publish details. Roderic O’Gorman T.D, Minister for Children, Equality, Disability, Integration and Youth welcomed the Bill saying: “With the passage of the Gender Pay Gap Information Bill, pay transparency is now one step closer. Reporting of the gender pay gap by employers will provide accountability and transparency, helping to ensure that employers address the gender pay disparity between men and women. The passing of this strengthened legislation is testament to this Government’s commitment to gender equality, and I am determined to continue making progress on this”. Read the Bill. Pensions Authority publishes draft code of practice for trustees of occupational pension schemes and trust RACs The Pensions Authority has published a draft code of practice for trustees of occupational pension schemes and trust RACs which sets out what the Authority expects from regulated entities to meet their obligations under the European Union (Occupational Pension Schemes) Regulations 2021 (the Regulations). The Authority welcomes views on the draft code of practice, and the closing date for the receipt of submissions is 5pm Thursday 16 September 2021. The final code of practice will be published in the week commencing 15 November 2021. In addition, the Authority will issue information for new one-member arrangements on the Regulations, and information on the annual compliance statement provided for under the Regulations during the week of 30 August 2021. Guidance for the public and employers about the minimum standards they should expect from master trust vehicles will be published the week of 13 December 2021. Irish SMEs to avail of a €2,000 voucher to cover energy audit The Sustainable Energy Authority of Ireland (SEAI) is encouraging Irish SMEs to take control of their energy use with the launch of a new support scheme, the Support Scheme for Energy Audits. The scheme will provide SMEs with a €2,000 voucher to cover the cost of an energy audit, which identifies tailored energy saving opportunities that can save businesses up to 30 percent on their energy bills and help to reduce their climate impact. The audit will also assess whether renewable energy technologies are a viable option for their business. More details can be found here. Accounting and business sector largest portion of 2021’s new start-ups A new study by risk analyst firm CRIFVision-net reportedly shows that of the almost 14,000 new companies registered in Ireland in the first half of 2021 (an increase of 42 percent on the same period in 2020) the legal, accounting and business sector accounted for the largest portion, with a total of a total of 2,543 new companies registering. This is an increase of 19 percent when compared to 2020. However, Christine Cullen, Managing Director of CRIFVision-net, in a statement said the figures show that many businesses are struggling and will continue to struggle for the foreseeable future, with the impact the pandemic visible in rising insolvencies (up 45 percent) in the first half of the year: "These insolvencies are likely to increase, particularly in hospitality sector, as Government supports are rolled back and credit lines dry-up”. NI private sector experiences fastest sector growth in seven years Northern Ireland has seen its fastest pace of growth across the private sector in almost seven years, according to according to the latest Ulster Bank purchasing managers’ survey for June. The report shows: A new 7-year high in the rate of new orders (58.7) A record rise in the rate of input costs (87.5) led by construction (97.5) A record rise in firms’ prices (70.9) led by construction (85.1) A record increase in backlogs (58.8) A slow in employment growth from joint record high (53.7) A reading of above 50.0 signals an increase on the previous month, while below 50.0 signals a decrease. According to an article in the Financial Times, PwC, Deloitte and KPMG have already announced plans to create 2,200 jobs over the next five years which will further boost Northern Ireland’s 43,000-strong professional and financial services sector. PwC has now opened its Merchant Square office in Belfast and Jackie Henry, Deloitte’s lead partner for Northern Ireland points to the popularity of Belfast with staff: “We have one of the youngest populations across Europe here. It’s a brilliant starting point.” Henry, whose firm already has 1,000 people in Belfast and plans to double that by 2025 as it invests in areas including data analytics, cloud, robotics and cyber security, chairs the regional government’s skills advisory working group. However, Richard Ramsey, chief economist Northern Ireland, Ulster Bank, reportedly stated that it was also the worst quarter for inflationary pressures in the PMI survey’s history. “Rising demand coupled with ongoing supply chain disruption led firms to increase their backlogs of work at the fastest pace in the survey’s 19-year history”. Ramsey further stated this it is likely that supply chain disruption and significant inflationary pressures will be a feature of the business environment “for the rest of the year and well into 2022”.  You can find information, guidance and supports to help members understand sustainability and meet the challenges it presents in our Sustainability Centre.   Read all our updates on our Public Policy web centre  

  The Institute has written to Tánaiste Leo Varadkar this week asking his Department to consider applying the current tax relief system to auto-enrolment and also to consider the timeline for auto-enrolment’s introduction.

Sustainable Energy Authority of Ireland (SEAI) is encouraging Irish SMEs to take control of their energy use with the launch of a new support scheme. The scheme will provide SMEs with a €2,000 voucher to cover the cost of an energy audit. An energy audit identifies tailored energy saving opportunities that can save businesses up to 30 percent on their energy bills and help to reduce their climate impact. The audit will also assess whether renewable energy technologies are a viable option for their business. Speaking about the new support scheme Eamon Ryan, Minister for Environment, Climate Action and Communities said: “This is a really exciting opportunity for all SMEs who really want to save energy, but don’t know where to start. This scheme from SEAI will support high-quality, practical energy audits that will clearly lay out what they should do, and how they should do it. Armed with this information, our SMEs will be able to take action on energy, which will save them money and make a vital contribution to our climate change goals.” The new scheme also provides an opportunity for energy auditors, William Walsh, FCA and CEO of SEAI said: “Energy audits really empower businesses, providing them with the information they need to make the best decisions for their organisation. This is also a great opportunity for energy auditors to provide their expertise to the SME sector on where energy is being used and what actions are going to be most effective at improving energy efficiency.” To be eligible, SME applicants must; be must be registered in Ireland with the facility to be audited  located in Ireland also, spend at least €10,000 per year on energy, have fewer than 250 employees and have an annual turnover of less than €50 million or balance sheet of less than €43 million. Vouchers will be awarded to SMEs who will use it to pay the SEAI registered auditor, once the audit is complete. Only auditors registered with the SEAI can claim the cost of the voucher from SEAI. SMEs from all sectors and public bodies are encouraged to apply. SEAI recommends that SMEs contact their nominated auditor in advance, to ensure that the voucher will cover the cost of their audit. Further information on the Support Scheme for Energy Audits can be found here: https://www.seai.ie/business-and-public-sector/small-and-medium-business/energy-audits/ About SEAI SEAI is Ireland’s national energy authority investing in, and delivering, appropriate, effective, and sustainable solutions to help Ireland’s transition to a clean energy future. It works with Government, homeowners, businesses, and communities to achieve this, through expertise, funding, educational programmes, policy advice, research, and the development of new technologies.

The European Commission recently adopted a package of proposals to make the EU's climate, energy, land use, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55 percent by 2030, compared to 1990 levels.  The package includes a Carbon Border Adjustment Mechanism to put a carbon price on imports and a proposed revision of the Energy Taxation Directive.  Carbon Border Adjustment Mechanism (CBAM) The CBAM will equalise the price of carbon between domestic products and imports and ensure that the EU’s climate objectives are not undermined by production relocating to countries with less ambitious policies. It also aims to encourage industry outside the EU to take steps in the same direction. Under the CBAM system EU importers will buy carbon certificates corresponding to the carbon price that would have been paid, had the goods been produced under the EU’s carbon pricing rules. Conversely, once a non-EU producer can show that they have already paid a price for the carbon used in the production of the imported goods in a third country, the corresponding cost can be fully deducted for the EU importer. The CBAM will be phased in gradually, initially apply only to a selected number of goods at high risk of carbon leakage: iron and steel, cement, fertiliser, aluminium and electricity generation. A simplified CBAM system, where importers will have to report emissions embedded in their goods without paying a financial adjustment will apply as from 2023 for selected products with the objective of facilitating a smooth roll out and to facilitate dialogue with third countries. The definitive system is expected to become fully operational in 2026.  Revision of the Energy Taxation Directive The proposal to revise the Energy Taxation Directive aims to align the taxation of energy products with EU energy and climate policies, promote clean technologies and remove outdated exemptions and reduced rates that currently encourage the use of fossil fuels. The main changes in the revised Directive are: Fuels will start being taxed according to their energy content and environmental performance rather than their volume. The way in which energy products are categorised for taxation purposes will be simplified to ensure that fuels most harmful to the environment are taxed the most. Products covered by the Directive are grouped and ranked according to their environmental performance. Fuels that have the most negative impact on the environment will be subject to higher minimum rates. Exemptions for certain products and home heating will be phased out, so that fossil fuels can no longer be taxed below minimum rates. Member States will be able to support vulnerable households and protect against energy poverty. Fossil fuels used as fuel for intra-EU air transport, maritime transport and fishing should no longer be fully exempt from energy taxation in the EU. For more details see the Commission’s press release.

As we emerge from the pandemic, our focus once again turns to saving our planet. One way to encourage sustainability in organisations is through wellbeing challenges. Anna O’Flanagan explains how. How is your team doing right now? The teams I have spoken with recently seem to be worried about everything, from their own health to the overall wellbeing of our planet. This is all very normal for the times we are in. Many teams have set up fitness or health and wellbeing challenges, and these have proved highly successful in bonding the team while also promoting physical and mental health. What if there was a way to develop this team wellness theme further while also benefiting the environment? A team sustainability challenge that combines these complementary goals could fortify your team and give them a sense of empowerment because they are taking control of their mind, body and environment. Goal of sustainability Sustainability aims to promote an environment where nature and humans can exist in harmony, as set out in the UN Sustainable Development Goals. This focuses not only on the environment but also on poverty, health, education and housing (and more). Therefore, leaders should take the opportunity to bring the team together (online or in offices as they begin to open) to brainstorm ways to incorporate sustainable practices (personal and environmental) into their everyday lives as part of a challenge. Here are some task ideas: Plan and encourage employees to attend sustainability events and courses; Cycle to work or to run your errands. It addresses a possible fitness goal while keeping one less car on the road; Make a bird feeder for an outdoor space; Learn how to compost; Plan your meals to reduce food waste; Use a reusable coffee cup; Plant a tree in your garden; or Volunteer in your community. Once you agree on your priorities as a team, you can then assign points to each activity, give it some timelines, and off you go. Incentives and prizes are always good motivators, so ensure that they are valued by your employees while also maintaining the organisation’s sustainability goals. This type of challenge will not only give the team a sense of working towards a common purpose, it can also release them from the feeling of powerlessness in the face of climate change and COVID-19 and create sustainable practices in their personal and professional lives. And, it will transport them from their (ever-decreasing) spaces to feel part of something bigger, more communal, and that affects change. Anna O’Flanagan is the Founder of Red Squirrel.

  Chartered Accountants Ireland has shared a new guide on navigating sustainability-related reporting. You will also find details of our response to the public consultation on Northern Ireland’s Climate Change Bill; a new report published by the UK Green Jobs Taskforce; and a round-up of legislative measures in the EU’s ‘Fit for 55’ package. New guide published on navigating sustainability-related reporting A new guide on navigating the sustainability-reporting landscape has been published, and is free to download and circulate. While business performance has historically been measured in financial terms, over the past two decades reporting requirements have been changing rapidly. Societal awareness of environmental and social issues is increasing and, as a result, stakeholders are demanding a wider range of information with a clear global trend towards mandatory sustainability reporting. ‘Navigating the Reporting Landscape’ gives finance professionals an introduction to this sustainability-related reporting. Created by A4S and its Accounting Bodies Network (of which Chartered Accountants Ireland is one), the publication offers a brief introduction to the changing corporate reporting landscape. It summarises recent key developments in sustainability reporting and shows how it is impacting the role of the accountant and shaping the future of corporate reporting. It also highlights how this area is likely to evolve going forward, offering signposting to further sources of information. The guide can be downloaded here. Chartered Accountants Ireland responds to the public consultation on Northern Ireland’s Climate Change Bill Chartered Accountants Ireland has responded to the public consultation on the call for views on the Northern Ireland Climate Change Bill. This Bill aims, among things, to establish a legally binding net-zero carbon target for the region and provide for a Northern Ireland Climate Commissioner and Northern Ireland Climate Office. Chartered Accountants Ireland supports the objective of introducing legally binding greenhouse gas emissions in Northern Ireland. The lack of legislative basis, to date, has been prohibitive in reducing greenhouse gas emissions in Northern Ireland, which is currently the lowest performing devolved region of the UK in this respect. Among other recommendations, we also specifically advocated for the following: accountability, which will be critical to ensuring sectoral targets are met the setting out of interim targets for emissions-reduction government incentives for people and businesses to switch to less carbon-intensive technologies a forum in Northern Ireland for professional bodies, such as Chartered Accountants Ireland, and government agencies to meet regularly, exchange information and ideas and collaborate in communications to the enterprise sector Climate Action Plans (CAPs) to be ‘living documents’, monitored every quarter and updated annually clarity around who will set the targets within the CAPs, how each department and public body are to be held accountable for the delivery of actions, and who will be responsible (and what the ramifications will be) where targets or measures are not met a specific board established within the Assembly to hold departments and public bodies accountable for delivering the CAP a requirement to carry out an assessment of the economic impact of the level of changes that are required to achieve Northern Ireland’s targets the appointment of a specific body to recommend the appropriate five-year carbon budgets, from which clear decarbonisation targets can then be set for each sector, and against which the Minister with primary responsibility for that sector would report on progress annual to the Assembly. that every public body should have to adopt a mandate for climate action and embed decarbonisation measures across all their services that all government decisions and major investments should be ‘carbon proofed’, and this should be enshrined in law. Our response to the consultation can be found here. UK government publishes Green Jobs Taskforce report The UK’s Department of Business, Energy & Industrial Strategy has published it’s Green Jobs Taskforce Report. The report, which was written between November 2020 and July 2021, brings together evidence on the skills needed for the UK’s transition to net zero, and sets out the recommendations for how all stakeholders can work together to manage the opportunities and the challenges of the transition to net zero. The report was issued by the Green Jobs Taskforce, which comprises members from industry, academia, unions, and the education and skills sector, and advises government, industry and the education sector. The UK government will consider the Taskforce’s evidence and recommendations in the development of the UK’s first Net Zero Strategy, to be published before COP26 in November this year. A seismic shift for climate action  It’s been a busy fortnight for climate and environmental action. First, the secretariat of the UN Convention on Biological Diversity published the first draft of a new global agreement to reverse biodiversity loss by mid-century. The draft text proposes, among other things, placing at least 30 per cent of the world’s land and seas under protection, reducing subsidies that are harmful to biodiversity and increasing financial resources for biodiversity protection. Countries are under pressure to reach an agreement on the draft deal at the 15th Conference of the Parties in China in October, as none of the targets set in 2010 were fully met by the 2020 deadline. On Wednesday the European Commission adopted ‘Fit for 55’  –  an enormous package of legislative proposals to make the EU's climate, energy, land use, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55 per cent by 2030 (compared to 1990 levels). The package contains the legislative ‘tools’ to deliver on the targets agreed in the European Climate Law, and will fundamentally transform Europe’s economy and society. The proposals are ‘connected and complementary’ and include changes to the EU Emissions Trading Scheme (ETS) and the Effort-Sharing Regulation, as well as to regulation on land use, forestry and agriculture, renewable energy and energy efficiency, CO2 emissions standards for cars and vans, requirements for aviation and maritime fuels, the Energy Taxation Directive, and a new Carbon Border Adjustment Mechanism which will put a carbon price on imports of a targeted selection of products to avoid ‘carbon leakage'. A new Social Climate Fund has also been proposed, financed by the EU budget, to provide dedicated funding to Member States to help citizens finance investments in energy efficiency, new heating and cooling systems, and cleaner mobility. A complementary initiative to the Fit for 55 Package had already been published in July, when the European Commission issued its sustainable finance strategy and proposed a Regulation to create the “European Green Bond Standard” or “EUGBS” (a voluntary “gold standard” for green bonds).   The Sustainability Finance Strategy outlines the role of the finance sector in helping meet the EU’s targets to strengthen its resilience to climate change, reverse biodiversity loss and the broader degradation of the environment, and to leave nobody behind in the process. Speaking at the launch of the strategy and EUGBS, on 6 July Commissioner Mairead McGuinness, MEP, described climate change as a risk to financial stability, and further stated that what’s needed is a financial system that is resilient against physical and transitional shocks, particularly “the risk of a financial shock if our move towards sustainability is disorderly”.   The Strategy will help the economy transition to sustainability using four pillars: transition, inclusiveness, resilience and the global perspective, and will build a more inclusive sustainable finance framework. You can find information, guidance and supports to help members understand sustainability and meet the challenges it presents in our Sustainability Centre.