The government proposal for a comprehensive amendment to the Act on Accounting is headed to the Chamber of Deputies. Its goal is to implement the EU’s Corporate Sustainability Reporting Directive into the Czech legal system. This legislative change, which is scheduled to take full effect on 1 January 2027, represents a major change for the corporate clients as it is expected to significantly expand companies’ disclosure obligations in the area of non-financial reporting.
The draft amendment newly introduces an obligation for a specified scope of large and medium-sized enterprises to prepare a sustainability report as a clearly separated section of their annual report. In this document, the affected entities are expected to provide a detailed and structured account of the impact of their activities on sustainability (environmental, social, and human rights matters), while also disclosing how these risks affect the development, performance, and financial position of the company itself. In this context, the statutory framework formally introduces the principle of double materiality. This way, companies are supposed to demonstrate not only how sustainability-related risks affect their own financial results, but also the impact of the company’s activities on its surrounding environment and society. Together with these changes, accounting terminology is set to undergo a comprehensive update to align with modern European standards.
The new regulation is also expected to have a significant impact on the area of corporate governance. The statutory body of the company will hold full responsibility for ensuring that the sustainability report is prepared in accordance with the relevant European Sustainability Reporting Standards (ESRS). The draft amendment also introduces a requirement for these reported sustainability disclosures to undergo a mandatory assurance by an independent auditor. This should entail new operational and procedural demands for companies.
Although the new act is expected to take effect with a deferred date following the completion of the legislative process, the parliamentary print itself sends a clear signal to the corporate sector to begin gradual internal preparations in advance. As soon as the legislation is finally enacted, affected companies will be required to have established their internal processes in good time and aligned their supply chains accordingly.
Legal Update 09/2026 download here.