International Sustainability Standards Board (ISSB)
On 3 November 2021, during the COP26 negotiations, the International Financial Reporting Standards Foundation (IFRS) announced the establishment of the International Sustainability Standards Board (ISSB). This is a new board consisting of 14 members that will develop and set global sustainable standards for businesses.
The ISSB will merge and build on existing international frameworks, consolidating the work of the Climate Disclosure Standards Board (CDSB), the Task Force on Climate-Related Financial Disclosures (TCFD) and the Value Reporting Foundation (VRF). The ISSB sustainability standards will be called the IFRS Sustainability Disclosure Standards (SDS) and preliminary plans suggest that companies could be reporting using these by 2023.
The ISSB’s goal is to provide a high quality, transparent and globally comparable sustainability reporting system. This hopes to provide international, national and regional investors with trustworthy information about a company’s financial and non-financial sustainability-based risks and opportunities. This will help investors make more informed decisions and provide a gold standard for environmental, social and governance (ESG) reporting.
The establishment of the ISSB will help direct capital towards more sustainable and resilient long-term businesses. This is important to investors as the resilience of a business to climate change and other environmental challenges will impact its financial values and liabilities.
If you would like any advice on how the IFRS SDS will affect you, please get in touch. The experts at Nature Positive can provide guidance on becoming a positive and sustainable business.
*Banner photo by Markus Spiske on Unsplash