WEBVTT

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So sustainability means long term.

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So it means that you have to introduce
into your management and governance

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decisions, as much as possible,
the vision of your future development and

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try to navigate the risks and, of course,
foster the opportunities.

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Patrick, Tim,
thank you so much for being here.

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Patrick, this first question is for you.

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What does the regulatory landscape look
like right now in Europe?

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Moving towards more competitiveness,
which means that, you know,

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the regulatory aspect is played down a
little bit.

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So there is a simplification exercise on
everything that is related to

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sustainability and, in particular,
sustainability reporting and a better

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coordination of regulations in the EU.

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But overall, there is no, you know,
obstacle to the idea of the Green Deal

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being still a key objective for the EU.

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So it's a balancing act between
maintaining the Green Deal objectives and

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also promoting better competitiveness of
businesses because we certainly need to

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do something in the EU about that.

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Tim, what does this mean for
companies and how does it create value?

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It's a great question.

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So companies, I think,
have long felt that overregulation just

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gets in the way of competitiveness and
business value.

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And I think what's going on in Europe
right now, as Patrick said,

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is a simplification of all the
bureaucracy,

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leaving intact the fundamental objective
of advancing sustainability,

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but at a much less cost.

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And so they've been taking down a lot of
that regulatory pressure and moving

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towards a more incentive-based system.

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This question is for both of you,
how can companies balance the costs with

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the value of sustainability?

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So sustainability means long term.

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So it means that you have to introduce
into your management and governance

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decisions, as much as possible,
the vision of your future development and

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try to navigate the risks and, of course,
foster the opportunities.

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So I see that as, for me,
a primarily a management and governance

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mechanism and not a compliance exercise
for regulatory purposes.

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Regulatory and transparency with
stakeholders is key, but it's secondary.

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What is key is that the companies be
taking the right decisions at the right

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moment in order to meet the expectations
and also the challenges of the evolution

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that we see every day.

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And this is why Patrick is such a great
leader of the European standards center,

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because most people who are in standards,
it's just about check the box—like,

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did you do it?

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But as you said,
it's much more about the business value.

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What is sustainability reporting telling
us as a corporation—where are the risks,

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where are the opportunities.

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And I think that gets lost in this
conversation.

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And so to have that kind of comment come
from you, I think is quite telling,

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and I think it's exactly what
sustainability reporting should be doing.

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One more question for both of you.

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What role does AI play in the success of
all this?

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Now we think that there are many,
many opportunities that lie into the

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implementation of AI tools.

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Of course,
you have to distinguish between, you know,

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business environment,
where data is structured and where the

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tools create a more efficient management
of all the processes,

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and the more general AI that is, you know,
trying to find data,

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the quality of which might be, you know,
not so good. In a business environment,

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a huge tool to leverage efficiency and
productivity.

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And in reporting and data collection,

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it's a magic tool.

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So I'll take it from a different angle.

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Before BCG,
I was the CEO of the Global Reporting

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Initiative.

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And I used to say,
the data we create is only useful if it's

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used. And somehow we've lost that thread.

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So companies are creating the
sustainability reports,

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they're putting them out there,

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and what happens?

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Almost nothing.

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AI unlocks the value of sustainability
reporting.

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We supported EFRAG this year—

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EFRAG is the European standard setter—to
gather up all the sustainability

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information.

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And we applied a bespoke AI model to that.

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We created so many insights that are up
on your website right now that really are

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unlocking the value of sustainability
reporting.

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Thank you, both, so much.

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Thank you.