ESG REGULATION PUBLISHED IN THE LAW BOOK
ESG reporting entered Czech law through the implementation of the CSRD and requires covered companies to disclose environmental, social and governance information. EU rules were substantially narrowed in 2026 and now focus mainly on the largest companies. The article explains the sustainability report, its content and the original structure of the reporting obligations.
However, not all companies will be required to prepare a sustainability report. From the 2025 financial years, the obligation to prepare a sustainability report applies under Czech legislation only to a business corporation, savings and credit cooperative, or insurance company that is a public interest entity, a large accounting entity, and has an average of more than 1,000 employees (Section 32f(1) of the Act on Accounting).
The regulation also provides for several exemptions from the obligation to prepare a sustainability report. For example, investment funds, companies not traded on a European regulated market, or companies that are part of multinational groups from the European Union that fulfill their ESG reporting obligations will not be obligated entities.
The requirements for preparing a sustainability report will begin to apply to financial years starting on 1 January 2024. The planned expansion of the scope of obligated entities is not taking place: on the contrary, in both the Czech Republic and the EU, the obligation has been narrowed to the largest companies.
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Our services are used by companies, institutions, and public entities because our Prague-based legal team provides them with comprehensive legal support in the field of ESG. For example:
- Practical setup of ESG strategy: We will help you implement ESG principles so that they align not only with legislative requirements but also with your business goals.
- Minimization of legal and reputational risks: We will advise you on how to properly set up internal processes and reporting obligations so that your organization is prepared for current and future regulations.
- Clear and understandable communication: We will explain everything to you simply and clearly, without unnecessary legal jargon.
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We know that navigating ESG legislation and requirements can be complex. That is why we want to show you how we can help.
Do you want to make sure first that our services meet your needs? We have prepared a free e-book for you, which will show you how to effectively manage ESG issues. In the e-book, you will find:
✅ Practical advice on how to set up and put an ESG strategy into practice.
✅ Specific tips on how to avoid the most common mistakes in ESG reporting and compliance.
✅ A demonstration of our approach: how we clearly and effectively share expert knowledge in the field of ESG.
We will be happy to help you with any aspect of ESG – from strategy to compliance.
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Disclaimer:
The information contained in this article is for general informational purposes only and serves as a basic guide to the issue as of 2026. Although we strive for maximum accuracy, laws and their interpretation evolve over time. We are ARROWS Law Firm, a member of the Czech Bar Association (our supervisory authority), and for the maximum security of our clients, we are insured for professional liability with a limit of CZK 350,000,000. To verify the current wording of the regulations and their application to your specific situation, it is necessary to contact ARROWS Law Firm directly (consultation@arws.cz). We are not liable for any damages arising from the independent use of the information in this article without prior individual legal consultation.