Act I of 2026 transposes the EU Corporate Sustainability Reporting Directive (CSRD, Directive 2022/2464/EU) into Maltese law, amending the Companies Act (Chapter 386) and the Accountancy Profession Act (Chapter 281). Large public-interest entities, large companies meeting two of three thresholds (250+ employees, €25m+ balance sheet, €50m+ turnover), and listed SMEs (with a phase-in delay) are required to publish an annual sustainability report covering environmental, social, and governance (ESG) matters prepared in accordance with European Sustainability Reporting Standards (ESRS).

The sustainability report must be included in the directors' report, presented in machine-readable XHTML format tagged with the European Single Electronic Format (ESEF) taxonomy, and assured by an accredited third-party assurance provider (limited assurance from 2025, reasonable assurance from 2028). The Malta Financial Services Authority and the Accountancy Board are designated as the competent authorities for enforcement. Administrative penalties for non-compliance are set at up to €1 million or 10% of annual turnover, whichever is higher.

Value-chain reporting requirements impose an obligation on in-scope companies to conduct due diligence on the sustainability performance of their major suppliers and to disclose material sustainability risks across the supply chain. The Act also amends the Investment Services Act (Chapter 370) to require fund managers to integrate sustainability risks into their investment decision-making disclosures. Reporting obligations apply progressively: the largest entities (already reporting under NFRD) from financial year 2024; other large companies from 2025; listed SMEs from 2026 (with opt-out until 2028).

Corporate Sustainability Reporting (Transposition) Act (Act I of 2026)