On 3 November 2021, the International Financial Reporting Standards (IFRS) Foundation announced the formation of the new International Sustainability Standards Board (ISSB). The ISSB will develop a comprehensive global baseline of high – quality sustainability disclosure standards which are focussed on enterprise value. The ISSB will focus on meeting the sustainability information needs of investors for assessing enterprise value and making investment decisions. The standards will help investors understand how companies are responding to ESG issues, like climate, diversity etc. to inform capital allocation decisions
The establishment of the ISSB marks a significant milestone in the journey towards a holistic corporate reporting by global corporates, given the growing significance of Environment, Social and Governance (ESG) disclosures to investors in the global markets today.
As a stepping stone, the IFRS Foundation created the Technical Readiness Working Group (TRWG) to provide recommendations to the ISSB. The TRWG work plan includes creating prototypes containing technical recommendations for consideration by the newly constituted ISSB. On 3 November 2021, the TRWG published the first two deliverables for ISSB’s considerations namely:
- General Requirements for Disclosure of Sustainability-related Financial Information (General Requirements Prototype)
- Climate-related Disclosures Prototype.
This issue of First Notes aims to provide an overview of the ISSB and the work plan laid out by the Technical Readiness Working Group (TRWG) for consideration by the ISSB. After starting its work, the ISSB is expected to consult publicly on any proposals informed by the TRWG’s recommendations. The ISSB’s work will be subject to the IFRS Foundation’s due process.
To access the press release released by the IFRS Foundation on 3 November 2021, please click here
To access the KPMG IFRG Limited article issued on 3 November 2021, please click here
To access the KPMG US Briefing Issue issued in November 2021, please click here.
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