Several important developments have taken place in recent weeks in both the international and Hungarian ESG landscape. In this blog post, we have summarized the key changes and updates relevant for 2025.
Changes in ESG Regulation: Updates at EU and national level
Driven by the EU’s efforts to enhance competitiveness, the ESG regulatory framework is undergoing significant transformation at the European level. As a result, various implementation provisions have also been introduced into the Hungarian regulatory landscape. These changes affect three key pillars of Hungary’s ESG regulation: as of June 2025, both the Hungarian ESG Act and the Accounting Act have been amended once again, and from 1 July 2025, the new ESG questionnaire, based on the latest recommendation from the Central Bank of Hungary (MNB), has come into force.
These regulatory updates - some of which introduce new deadlines - underline the importance of keeping ESG considerations on the corporate agenda. At the same time, they provide an opportunity for phased preparation in both sustainability reporting and ESG disclosures.
Defining the ESG-relevant data set tailored to a specific company, followed by data collection, analysis, and target-setting, is a multi-step process - one that, based on our experience with voluntary reporting, often requires significant time and resources, whether the company operates in manufacturing, commerce, or services.
Let’s take a closer look at the key changes, timelines, and regulatory expectations companies can expect in the coming period.
ESG reporting obligation: Who is affected?
The recent amendment to the Hungarian ESG Act also changes the scope of entities required to prepare an ESG report:
Who are the newly obligated companies?
- For financial years starting in 2024, the scope of obligated entities remains unchanged.
- From financial years starting in 2025, companies will be required to prepare an ESG report if they meet all of the following criteria:
- Their annual net revenue exceeds HUF 90 billion (approx. EUR 230 million), and
- They employ an average of more than 500 people, and
- Their core activity falls within sectors specifically listed in the Act.
SMEs (small and medium-sized enterprises) are excluded from the scope of the ESG Act and can only become subject to the requirements indirectly (e.g. through value chain expectations).
Why voluntary ESG reporting makes strategic sense
The current regulatory framework allows companies to voluntarily prepare ESG reports — even if they are not yet formally obligated to do so. This is particularly beneficial for businesses that are likely to fall under future ESG obligations or seek to gain a competitive edge by starting their preparation early. It can also be a key asset for participating in public procurement procedures.
Voluntary ESG reports must meet the same content and procedural requirements set by the Supervisory Authority for Regulated Activities (SZTFH) as mandatory reports. This makes early, hands-on experience valuable, allowing companies to test and refine internal processes before reporting becomes a legal requirement.
Based on RSM's advisory experience, a full ESG data collection and reporting process can take several months, as it typically involves coordination across multiple departments (e.g. finance, HR, IT, compliance). Starting early enables companies to identify and address gaps well in advance of any future mandatory requirements.
ESG reporting: Transitional provisions and deadlines (2024–2026)
For financial years starting in 2024, no external assurance is required for ESG reports. However, the company’s management remains responsible for ensuring the report meets legal requirements, and the report must be retained for three years from the date of its approval.
From 2024 to 2026, a unified set of simplified rules applies to both obligated entities and companies that opt in voluntarily. Specifically, these companies are not required to:
- Submit their ESG report to the Authority
- Publish the report on their website
- Provide an ESG assurance certificate
- Prepare or publish a mandatory Corporate Social Responsibility (CSR) strategy
ESG and public procurement: New conditions from 2027
Starting 1 July 2027, ESG-related requirements may be introduced as eligibility or contractual conditions in public procurement procedures. This includes submission of an ESG report or a state-approved ESG rating. These requirements will apply regardless of company size or sector, meaning even micro and medium-sized enterprises could be affected.
Sustainability reporting obligation: Who, when, and based on what thresholds?
The scope of companies obligated to prepare a sustainability report under the amended Accounting Act has not changed. Companies remain subject to the reporting obligation if, in two consecutive financial years preceding the reporting year, they exceed any two of the following thresholds (on an individual or consolidated basis):
- Total assets over HUF 10 billion
- Annual net revenue over HUF 20 billion
- Average number of employees over 250
However, these companies will now have to prepare their first sustainability report for the financial year starting in 2027 (instead of 2025). Based on EU recommendations, the two-year transition period is intended to support companies in preparing for compliance.
Please note: public-interest large undertakings are not granted this deferral period — their reporting obligations remain unchanged.
MNB ESG Questionnaire: New Expectations for the Financial Sector
Just recently, the Central Bank of Hungary (MNB) published its new ESG recommendations and the minimum ESG questionnaire, aimed at supporting the standardised ESG data collection and evaluation process across financial institutions.
The questionnaire was developed in close cooperation with SZTFH (the ESG Supervisory Authority), with the goal of harmonising their respective requirements as much as possible. We will provide an in-depth overview of this new recommendation in our next blog post.
Why ESG reporting and sustainability disclosure still matter
Despite transitional relief measures, ESG reporting and sustainability disclosures remain highly recommended — and for good reason:
- Compliance with emerging regulatory and public procurement requirements
- Competitive advantage over less-prepared market players
- Enhanced reputation and investor appeal through ESG transparency
- Risk identification and mitigation via structured ESG data management
- Improved access to financing under favourable loan conditions
A well-prepared ESG documentation framework enhances corporate reputation, supports risk management, and may significantly improve a company’s access to capital. According to RSM’s experience supporting numerous Hungarian businesses, early action leads to long-term returns.
The RSM ESG advisory team actively monitors regulatory developments. In an earlier blog post, we’ve explored:
Key Legislation and Guidelines:
- Act CVIII of 2023 (Hungarian ESG Act)
- 2025 Amendments to the Accounting Act
- MNB ESG Recommendation (effective 1 July 2025)
- ESG Questionnaire – Joint recommendation by SZTFH and MNB
