Questions & Answers
Regarding the DR on payment practices in G1-6, is the information on payment practices only expected regarding SMEs or a wider range of suppliers?
- Payment practices
- late payments
Background
ESRS G1 paragraph 2 presents the list of matters covered in the standard, which are collectively referred to as ‘business conduct or business conduct matters’. Paragraph 2 (b) clarifies that ‘the management of relationships with suppliers, including payment practices, especially with regard to late payments to small and medium-sized undertakings’.
Disclosure Requirement G1-6 paragraph 31 states that ‘the undertaking shall provide information on its payment practices’.
ESRS G1 paragraph 32 states that ‘The objective of this Disclosure Requirement (G1-6) is to provide insights on the contractual payment terms and on its performance with regard to payment, especially as to how these impact SMEs and specifically with respect to late payments to SMEs.’
Answer
The information on payment practices is not limited to SMEs but regarding all suppliers.
However, the list of ‘shall’ data points in ESRS G1 paragraph 33 has to be read in the context of the disclosure objective, which refers ‘especially’ to SMEs. Undertakings are expected, as part of ESRS G1 paragraph 33 (d), to provide complementary information, if material, to provide sufficient context, including information on payment practices specific to SMEs; for example, because there are significant differences in payment practices vis-a-vis large and SME business partners.
Relations
Paragraph | Content |
|---|---|
Appendix A - Application Requirements | |
Metrics and targets | |
Disclosure Requirement G1-6 – Payment practices | |
Disclosure Requirement G1-6 – Payment practices | |
Disclosure Requirements | |
Disclosure Requirement G1-6 – Payment practices | |
Metrics and targets |