Presenting the Israeli Law Proposal for Mandatory Sustainability Reporting
Link to the position paper – link
Sustainability reporting is undoubtedly at a crossroads. Businesses are expected to be voluntarily transparent, yet this has proven to be ineffective. The traditional approach to CSR, which was formulated mainly by the business sector, is beginning to alter its course. In the past, legislative and enforcement agencies have insufficiently examined the social and environmental conduct of corporations. The agencies have viewed this as “beyond compliance” for businesses. Today in the developed world there is a trend of ‘return to regulation’ and CSR is included in that trend. As Israel aspires to maintain its position as an advanced economy, it is crucial to be prepared for these upcoming changes. Alongside with these developments, we can also see a strengthening of civil society, a redistribution of responsibilities and resources, and a new way of economic thinking (sharing economy, social entrepreneurship, cooperatives etc.).
The law proposal attached to the position paper intends to find a method for regulating CSR in a more sophisticated manner. The law does not seek to set a harsh standard for corporations to obey ‘as is’; rather, it outlines a detailed set of sustainability reporting guidelines. These guidelines shift the enforcing responsibility from state agencies to the public. The public (through specialized NGOs) would now be able to judge and rate each corporation according to its performances. Today, the public and even business managers are eager to have a clear set of expectations in regards to CSR and some even prefer to shift to a model of CSR that is bound by law and under state supervision, where the requirements are clear to all.
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