Key points 

• The mission of the International Sustainability Standards Board (ISSB) is to establish a common set of sustainability disclosure standards that are globally comparable, consistent and reliable.
• The International Financial Reporting Standards (IFRS) S1: ‘General Requirements for Disclosure of Sustainability-related Financial Information’ requires entities to disclose information about all significant sustainability-related risks and opportunities; IFRS S2: ‘Climate-related Disclosures’ requires the identification, measurement and disclosure of all climate-related risks and opportunities.
• The first two finalised disclosures will be issued at the end of June, meaning reports aligned with the frameworks will need to be issued from early 2025.

Context

The presence of numerous sustainability reporting frameworks which do not provide a uniform perspective, as well as a lack of robust Environmental Social and Governance (ESG) data, will significantly impact the ability of investors and other key stakeholders to identify and measure the most pertinent ESG risks and opportunities affecting business operations. Since its announcement at COP26, the ISSB has subsequently come under increasing pressure to deliver a global baseline of sustainability disclosures. The scale of this task cannot be understated. Consolidating a plethora of voluntary disclosure standards into a set of comparable and universally acceptable and applicable disclosure standards is a hugely significant task. However, it is imperative that a universal set of standards is created. These can then be employed as an effective foundation for mandatory global reporting regulations.