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Follow our weekly bulletin on key public policy issues for the island of Ireland.

Sustainability

  In Public Policy news, read about  Ireland’s “Keep Well” campaign to support people through the COVID-19 pandemic, how Amazon have launched a dedicated store in the UK to sell climate-friendly products, and the latest measures from the EU in their quest to achieve carbon neutrality.      Irish Government launch “Keep Well” campaign As part of the national effort to cope with the COVID-19 pandemic, the Irish Government’s “Keep Well” campaign aims to support both people and communities to ensure that they look after their physical and mental health over the coming months. Launched by An Taoiseach, Micheál Martin, the Minister for Health, Stephen Donnelly, and Minister of State for the Department of Health, with responsibility for Public Health, Well-Being and the National Drugs Strategy, Frank Feighan T.D., the campaign encourages individuals, communities, and bodies such as volunteer groups, sporting organisations and local heritage and arts groups to “find ways to support everyone to discover new activities and routines that will do us good.” More information can be found on www.gov.ie/healthyireland.   Amazon promotes climate-friendly products This week, the retail giant, Amazon, launched a new eco-friendly section in its stores dedicated to sustainable consumption. Over 40,000 certified products that help reduce carbon footprint will feature in the store which are available to customers in the UK, France, Germany, Italy, and Spain. The climate-pledge-friendly selection can be found across grocery, household, fashion, beauty, and a range of other categories.  The strategy is designed to help consumers select products that are more environmentally friendly. European Council endorses 2030 Biodiversity Strategy EU environment ministers have adopted conclusions which endorse the objectives of the 2030 Biodiversity Strategy, a strategy aimed to reverse biodiversity loss and to ensure a more sustainable economy. The strategy aims at protecting and restoring the EU’s ecosystem which is key to boost resilience of the EU’s economy against threats such as climate change, forest fires, disease outbreaks, and food insecurity. Read more about the strategy on the EU's website.   European commission takes a big step towards climate neutrality The European Commission this week announced plans to open four public consultations on plans to limit the EU’s emissions of greenhouse gases. This is all part of the plan to increase the current emissions reduction target from 40 percent to at least 55 percent by 2030, and reach carbon neutrality by 2050.   The Commission propose to revise four laws currently in force in the areas of: EU Emissions Trading System, Effort Sharing Regulation, Land Use Change and Forestry Regulation, and CO2 standards for cards and vans.   Read all our updates on our Public Policy web centre.  

Oct 30, 2020
Sustainability

Kevin Lynch explains why ESG reporting is fast becoming a critical pillar in the evaluation of organisational stability. As we enter Climate Finance Week, a common question is: why should environmental, social, and governance (ESG) issues be a priority for my organisation? Among the many valid reasons, let’s take three – financing, brand and risk appraisal. 1. Financing The requirements and desires of financial investors are changing, with sustainability taking a central role. Investors are increasingly using sustainability as a proxy for how fast companies can respond to changing market conditions, and ESG reporting is an excellent place to set out your stall. Add to this the broader rise of dedicated ESG funds and green finance, and sustainability initiatives can open up new finance channels for organisations. 2. Brand Detailed ESG reporting is a mark of a conscientious brand and is received positively by employees, customers and suppliers. For employees, having a clear and tangible understanding of their organisation’s sustainability policies and the progress thus far improves workplace satisfaction and is viewed favourably by prospective employees. Complementing this, customers and suppliers are requesting better standards from the brands they engage with. By leading with clear policies and highlighting achievements, companies can stand out from the crowd. 3. Risk appraisal Well-developed ESG reporting provides a nuanced understanding of non-financial company risks. Interlinking ESG outputs with company risk management can deliver a competitive advantage for organisations in unstable economic times. If we accept ESG as a valid endeavour, the impetus is clear. The next question we need to ask is: how do we map our ESG goals? Ambiguity is a common pitfall for effective ESG reporting, with many companies trying to address a fog of war as they compare themselves to their competitors and their sector. Without mandated standards, however, this comparison is often not straightforward. To address the need for standardisation, an EU initiative is currently curating a shared taxonomy for sustainable activities. This shared taxonomy will be delivered at the end of 2022, which is a welcome step. But in place of the awaited taxonomy, an honest self-appraisal and an evaluation of sectoral best practice by the board and management team can position a company for strategic ESG success. Often central to self-evaluation, a materiality approach can provide a focus for tangible priorities, allowing a switch from compliance-based incentives to stakeholder-led initiatives that relate to wider-held business objectives. Embedding these initiatives throughout the business will enable leaders to monitor their success, make use of in-situ reporting methods, and ensure that the process is not a box-ticking afterthought. Having set or revised your ESG goals, you need to know how you can meaningfully measure progress against those goals. Frameworks such as TCFD (Task Force on Climate-related Financial Disclosures), SASB (Sustainability Accounting Standards Board), and GRI (Global Reporting Initiative) are beneficial. However, without well-defined goals aligned with strategic objectives and linked to measurable outcomes, the implementation will always fall short. By centring measurement in your ESG plan from the outset, it is possible to continuously evaluate not only your successes and failures but importantly, the areas where you lack clear information. When information for ESG progress is not readily available or well understood, this challenge should be faced head-on, and the first step is understanding the gaps. With many companies acknowledging ESG as a priority, many are asking: who is best-placed to oversee ESG delivery? Finance departments are in a unique position to support the delivery of ESG reporting and analysis, with responsibility spanning strategic objective-setting, financial and non-financial disclosures, and risk management and appraisal. In uncertain times, accountants provide trusted guidance in evaluating the continued stability of their organisations, and ESG reporting is becoming another pillar in this evaluation process. Kevin Lynch is Chief Technical Officer at The Information Lab Ireland.

Oct 29, 2020
Sustainability

The Climate Action Bill has ignited the drive for businesses to decarbonise, writes Lorraine McCann. The Climate Action and Low Carbon Development (Amendment) Bill 2020 commits Ireland to net-zero carbon emissions by 2050. Net-zero means that any emissions pumped into the atmosphere must be balanced by absorbing an equivalent amount of emissions. To have a reasonable chance of limiting global warming to 1.5 degrees celcius and stabilising climate change, we must reach net-zero emissions by 2050. Carbon footprinting The Bill has introduced a system of successive five-year carbon budgets, which means that emissions ceilings will be allocated to all relevant sectors. The first carbon budget will be introduced in 2021 and include all greenhouse gases (GHGs). This puts the onus on business to measure, monitor, report, and assure GHG emissions annually to ensure that companies fully understand their impacts and potential sectoral limitations. Carbon pricing Businesses must now set their own targets for net-zero emissions by 2050 and align with government decarbonisation target ranges to limit potential future costs. The carbon tax is currently €33.50 per tonne of CO2. However, this will rise by €7.50 annually to 2029, and by a further €6.50 in 2030, to achieve €100 per tonne of CO2. Businesses should calculate the current and potential cost of carbon to 2030 and beyond to determine the cost exposure level due to anticipated cost increases. Furthermore, those companies that persist with fossil fuel use, whether using a diesel/petrol fleet or using heating oil, will feel the hit of rising carbon taxes, motor tax, and VRT rates. The physical and transitional risks of climate change will bring significant costs for business. Any company that has not sought to understand how it will be impacted by climate change to 2050 should prioritise this as a critical action. Increasing regulation The Bill outlined a commitment to update the Climate Action Plan annually from 2021 onwards, and a National Long-Term Climate Action Strategy will be prepared once every ten years. All local authorities are also required to develop local Climate Action Plans covering both mitigation and adaptation actions. This will undoubtedly impact regulation, planning, and investment decisions across all sectors. The cost of compliance and climate adaptation should be factored into business decisions – the faster the move to decarbonise, the more incentives will be available to companies for retrofitting and transitioning to renewable energy. Opportunities in decarbonisation The scale of the challenge is immense. However, there are opportunities in decarbonisation. The transition to net-zero means that businesses now have a wealth of opportunities in innovation, emerging technologies, skills-building and job creation across the renewable energy sector, retrofitting, circular economy, clean mobility, infrastructure, sustainable agriculture, and the bio-economy. The Bill sets out a clear pathway to drive future investment in these areas. Lorraine McCann is Director, Climate Change and Sustainability Services at EY Ireland.

Oct 28, 2020
Sustainability

  In Public Policy news, read about the findings of a new report on the current and future skills needs of the Irish economy; and the new Localised Restriction Support Scheme available to businesses in Northern Ireland that have been forced to close due to health protection reasons.   Management skills essential to survival for SMEs and the economy A new report published by the Expert Group on Future Skills Needs (EGFSN) on SME Management Skills has revealed that 88 percent of Irish SMEs identify ‘developing management skills’ as an important strategic priority, but 49 percent of them have no formal budget to develop management and leadership. The report, entitled Leading the Way, stresses that management skills are essential to business productivity, resilience and survival. It recommends that management-development must be a strategic priority for all SMEs in Ireland, accounting as they do for almost 70 per cent of total employment in the Irish business economy. EGFSN advise the government on current and future skills needs of the economy and their impact on Ireland’s enterprise and employment growth. Minster for Further Education, Research, Innovation and Science, Simon Harris, T.D. has encouraged all SME managers to make management development a priority for 2021 and to take note of the resources, opportunities and supports available (many of them partly funded by the State): “This is not a time to pull back on investment in management training.  It is a time for SME managers to renew their commitment to world-class management skills and practices.” Echoing these sentiments, Minister of State of State for Business, Employment and Retail, Damien English, T.D., added that investment in management development is a commitment to the future. “The challenges facing the business sector right now make world-class management skills even more of an imperative for Irish SMEs”, the Minister stated, and he advised SMEs to contact their local LEO, Skillnet Ireland or representative organisation for advice. New Covid-19 support for business in Northern Ireland A new support has been made available for businesses in Northern Ireland forced to close due to health protection restrictions. Cafes pubs, restaurants, hotels, hairdressers, beauty salons, campsites, museums are just some of the businesses that may be eligible for the new scheme. Within its first week, the Localised Restrictions Support Scheme received approximately 7,500 applications. Under the scheme, businesses operating within a commercial property will receive the following amounts  (based on the total Net Annual Value of the property from which the business operates) for every week the restrictions apply:  Lower rate (up to £15,000 Net Annual Value) – £800 Standard rate (£15,001 - £51,000 Net Annual Value) – £1,200 Higher rate (over £51,000 Net Annual Value) – £1,600 For those businesses that do not qualify for the Localised Restrictions Support Scheme, they may qualify for the new Covid Restrictions Business Support Scheme which will open shortly. More details can be found at this link.   More details, including eligibility, how to apply and amounts available, are detailed under Loans and Grants on the Chartered Accountants Ireland Government Supports - NI page here.   Read all our updates on our Public Policy web centre.  

Oct 27, 2020
Sustainability

  In this week’s Public Policy news, read about the findings of a new report on the current and future skills needs of the Irish economy; and the new Localised Restriction Support Scheme available to businesses in Northern Ireland that have been forced to close due to health protection reasons.   Management skills essential to survival for SMEs and the economy A new report published by the Expert Group on Future Skills Needs (EGFSN) this week on SME Management Skills has revealed that 88 percent of Irish SMEs identify ‘developing management skills’ as an important strategic priority, but 49 percent of them have no formal budget to develop management and leadership. The report, entitled Leading the Way, stresses that management skills are essential to business productivity, resilience and survival. It recommends that management-development must be a strategic priority for all SMEs in Ireland, accounting as they do for almost 70 per cent of total employment in the Irish business economy. EGFSN advise the government on current and future skills needs of the economy and their impact on Ireland’s enterprise and employment growth. Minster for Further Education, Research, Innovation and Science, Simon Harris, T.D. has encouraged all SME managers to make management development a priority for 2021 and to take note of the resources, opportunities and supports available (many of them partly funded by the State): “This is not a time to pull back on investment in management training.  It is a time for SME managers to renew their commitment to world-class management skills and practices.” Echoing these sentiments, Minister of State of State for Business, Employment and Retail, Damien English, T.D., added that investment in management development is a commitment to the future. “The challenges facing the business sector right now make world-class management skills even more of an imperative for Irish SMEs”, the Minister stated, and he advised SMEs to contact their local LEO, Skillnet Ireland or representative organisation for advice. New Covid-19 support for business in Northern Ireland A new support was made available this week for businesses in Northern Ireland forced to close due to health protection restrictions. Cafes pubs, restaurants, hotels, hairdressers, beauty salons, campsites, museums are just some of the businesses that may be eligible for the new scheme. Within its first week, the Localised Restrictions Support Scheme received approximately 7,500 applications. Under the scheme, businesses operating within a commercial property will receive the following amounts  (based on the total Net Annual Value of the property from which the business operates) for every week the restrictions apply:  Lower rate (up to £15,000 Net Annual Value) – £800 Standard rate (£15,001 - £51,000 Net Annual Value) – £1,200 Higher rate (over £51,000 Net Annual Value) – £1,600 For those businesses who do not qualify for the Localised Restrictions Support Scheme, they may qualify for the new Covid Restrictions Business Support Scheme which will open shortly. More details can be found at this link.   More details, including eligibility, how to apply and amounts available, are detailed under Loans and Grants on the Chartered Accountants Ireland Government Supports - NI page here.   Read all our updates on our Public Policy web centre.  

Oct 23, 2020
Public Policy

A new support is available for businesses in Northern Ireland that are forced to close due to health protection restrictions.  The Localised Restrictions Support Scheme has been introduced to provide financial support to businesses which have been required to close or have had business activities at their premises directly curtailed by health protection restrictions that have been put in place by the NI Executive. More details, including eligibility, how to apply and amounts available, are detailed under Loans and Grants on our Government Supports page here      

Oct 20, 2020