ISSB Makes Key Announcements Towards the Implementation of Climate-Related Disclosure Standards in 2023

The ISSB recently announced that it is working with the European Commission and EFRAG toward a shared objective to agree as soon as practicable a framework for maximizing interoperability of their standards and aligning on key climate disclosures.

According to a recent press release, “This comes as the ISSB engages with jurisdictions globally and regularly consults with IOSCO in preparation for potential IOSCO endorsement of its proposed standards. It is a signal of significant momentum around the world, as more jurisdictions undertake work to consider how to incorporate the ISSB’s standards into their domestic systems of reporting.” 

Alignment is crucial to building a global baseline and reducing market fragmentation. CDP and the ISSB have announced that CDP will incorporate the IFRS S2 Climate-related Disclosures [IFRS S2] requirements into its global environmental disclosure platform. The announcement means that CDP’s 17,000+ voluntary users will disclose data structured to IFRS S2 in the 2024 disclosure cycle.

CDP’s decision, a signal of their commitment to delivering robust environmental disclosure to the market, encourages the early adoption of IFRS S2 disclosures, thereby providing investors with the information they need sooner, and reducing the reporting burden on entities through an alignment of requirements.

Furthermore, this will act as an enabler of the Climate Data Steering Committee's objective in launching a Net Zero Public Utility (NZDPU) to work towards the digitization of core climate data.

The press release notes that, “together, these announcements form a key milestone as the ISSB turns its attention from this foundational development to implementation preparation, as the ISSB plans to issue final Standards as early as possible in 2023.”

Erkki Liikanen, Chair of the IFRS Foundation, said that "a lot can happen in 12 months. One year on from the announced establishment of the ISSB at COP26, the board is now fully operational and committed to issuing its first two standards for adoption in 2023 following extensive global consultation this year."

Emmanuel Faber, Chair of the ISSB, added that “as we’ve heard from stakeholders, the need for climate-related financial disclosures is increasingly urgent. We are working collaboratively towards the implementation of effective sustainability disclosures for capital markets, which will empower market participants with the right information to support better economic and investment decision making.”

Jean-Paul Servais, IOSCO Chair and Chair of the IFRS Foundation Monitoring Board, believes that

"establishing a global baseline for corporate sustainability disclosures is a key ambition of IOSCO’s Workplan for Sustainable Finance, which aims to increase transparency and mitigate greenwashing in financial markets. We are pleased to see the strong momentum behind the ISSB toward this ambition since it was established last year. The review of the ISSB’s finalized standards for potential IOSCO endorsement will be a crucial step towards increased comparability in sustainability disclosure.”

For a lot more, see IFRS - ISSB at COP27: ISSB makes key announcements towards the implementation of climate-related disclosure standards in 2023.