SWITZERLAND Law and Practice Contributed by: Lorenzo Olgiati and Pascal Hubli, Schellenberg Wittmer Ltd
The reporting obligations apply to Swiss “com- panies of public interest” ie, Swiss-listed com - panies and certain FINMA-supervised financial institutions – if they meet certain thresholds on annual average in two successive financial years: • regarding the number of employees (at least 500 FTE); and • with either a balance sheet total exceeding CHF20 million or revenues exceeding CHF40 million. If within scope, the respective companies have to report on the risks of their business activi - ties in the areas of the environment (in particular, CO₂ targets), social concerns, labour concerns, human rights and the fight against corruption, as well as on the measures taken against these risks. Violations of these reporting duties are punishable by criminal sanctions (fines). The rules are largely based on known international provisions, such as Directive 2014/95/EU (the “Non-Financial Reporting Directive” ) concerning non-financial reporting. The first report for non-financial matters was required to be published in 2024 for the finan - cial year 2023. In this context, and in light of the EU’s revised Corporate Sustainability Reporting Directive (CSRD) (Directive (EU) 2022/2464), the Swiss Federal Council has identified a need to adapt the recently introduced Swiss regulation. As a result, the Federal Council opened the consul - tation on new provisions regarding corporate sustainability reporting obligations. Based on the developments in the EU, this revision project has meanwhile slowed down (see 2.1 Hot Topics in Corporate Governance ).
In order to further specify the environmental aspects of the reporting obligations on non- financial matters, on 23 November 2023, the Swiss Federal Council adopted the Implement - ing Ordinance on Climate Disclosures, which entered into force on 1 January 2024. The Ordi - nance provides for the mandatory implemen - tation of the internationally recognised recom - mendations of the Task Force on Climate-related Financial Disclosures (TCFD). Qualifying Swiss companies must report on: • the financial risk that a company incurs through climate-related activities; and • the impact of the company’s business activi - ties on the climate and the environment. This so-called double materiality perspective also corresponds to the approach of the EU. Due Diligence and Disclosure Obligations Regarding Minerals and Metals from Conflict- Affected Areas and Child Labour Companies whose registered office, head office or principal place of business is in Switzerland and whose business involves so-called conflict minerals or that offer products/services that are prone to child labour must further comply with special and far-reaching due diligence and reporting obligations (Articles 964j–964l CO). In particular, the due diligence and reporting obligations in the supply chain arise if a company: • imports minerals or specific metals containing tin, tantalum, tungsten or gold from conflict- affected and high-risk areas into or processes them in Switzerland; or • offers products and services in relation to which there is a reasonable suspicion that they have been manufactured or provided using child labour.
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