SWEDEN Trends and Developments Contributed by: Richard Engblom, Per Josephson, Anna Cumzelius and Amin Bell, Harvest Advokatbyrå
companies who are first in line for compliance – should begin their preparatory efforts at the ear - liest opportunity to ensure alignment with these upcoming regulations. However, Swedish companies should be rela - tively well prepared for the coming reporting obligations. The main reason for this is that Sweden implemented the current Non-Financial Reporting Directive (the NFRD, which is to be replaced by the CSRD) with a so-called gold plating, meaning that companies with an aver - age of more than 250 employees over the last two financial years are subject to reporting, as opposed to the more generous criteria of more than 500 employees in the NFRD (the NFRD is a so-called minimum harmonisation directive). As such, many larger companies are already used to providing sustainability reports. However, it is important to note that under the CSRD, these reports will need to adhere to new and more extensive standards of reporting. Looking ahead The upcoming Corporate Sustainability Due Dili - gence Directive (the CSDDD) is a crucial piece of legislation in the realm of ESG, holding signifi - cant implications for market practitioners. The CSDDD complements the CSRD with rules on how companies should conduct due diligence on their operations and supply chains to mitigate adverse impacts on the environment and human rights. This information is integral to the report - ing requirements of the CSRD. Summary To summarise, early adoption of ESG in business models has given Swedish financial companies somewhat of a head start in further integrating sustainability into their organisations. Also, the proactive implementation of the previous report - ing obligations under the NFRD has equipped
some larger companies to handle the more comprehensive reporting requirements that will be introduced with the CSRD. Furthermore, the SFSA is continuing to be active in its supervi - sory activities. These increased supervisory measures have, thus far, been broadly focused, allowing these authorities to gauge the financial industry’s progress and adaptation to the evolv - ing sustainability landscape. Sufficient Information in Credit Assessments Background In 2022, the SFSA imposed administrative fines on two Swedish banks, Svea Bank AB and Resurs Bank AB, for failing to obtain sufficient information to assess their customers’ credit - worthiness. The fines amounted to SEK50 and 45 million respectively (approximately EUR4.4 and 3.9 million). The sufficient information requirement is stated in the Consumer Credit Directive 2008/48/EC and has been implemented in Sweden through the Credit Consumer Act without any further specification of the information to be collected in order to be considered sufficient. The SFSA’s decisions The SFSA claimed that Svea Bank AB did not have a complete picture of its customers’ finan - cial situation since the bank had not considered all of its customers’ debt and expenses, but merely such information that had been provided in external credit reports. As regards Resurs Bank AB, the SFSA claimed that the information was insufficient since the bank had failed to carry out sufficient checks on the income information provided by the cus - tomers.
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