August 2022 - Update on the International Sustainable Standards Board

Article Highlights

• On November 3, 2021, The IFRS Foundation announced the creation of the International Sustainability Standards Board (ISSB).

• Two proposed IFRS Sustainability Disclosure Standards have been published to date.

• The ISSB has reached a quorum upon the recent appointment of six additional members to the ISSB.

• July 20 to 21, 2022 - First public meeting of the ISSB.

• On the week commencing September 19, 2022 - The next ISSB meeting. It will be held in Frankfurt, Germany.

• On the week commencing October 17, 2022 - The ISSB will meet in Montreal, Canada.

On November 3, 2021, The IFRS Foundation announced the creation of the International Sustainability Standards Board (ISSB) at the 2021 United Nations Climate Change Conference (COP26) in Glasgow, Scotland.

The ISSB sets the IFRS sustainability disclosure standards. It is the global setter for sustainability disclosures for financial markets.

The IASB and the ISSB will work together to ensure compatibility between IASB’s IFRS Accounting Standards and the ISSB’s IFRS Sustainability Disclosure Standards. Each Board will be independent.

Background

The proposed rule has been brought about in the context of the growth in climate action and standardization of climate-related disclosures. Canada, United Kingdom, Japan, New Zealand, Hong Kong and the European Union are all moving to adopt measures that are similar. In 2021, the Task Force on Climate-related Financial Disclosures (TCFD) had 2,600 companies across the world obtain voluntary guidance. In the past year, the International Sustainability Standards Board has been created by the International Financial Reporting Standards Foundation (IFRS).

Updates

In March of 2022, the ISSB published the first two proposed IFRS Sustainability Disclosure Standards. The ISSB is currently seeking feedback on the two proposed IFRS Sustainability Disclosure Standards.

As of July 2022, The appointment by the IFRS Foundation Trustees of the six additional members of ISSB has allowed the ISSB to reach a quorum.

From July 20 to 21, 2022, the ISSB held its first public meeting in Frankfurt, Germany. The agenda and meeting papers from the first public meeting was published. The ISSB did not make any technical decisions at the first meeting. It did share feedback it has received so far from stakeholders regarding the two proposed IFRS Sustainability Disclosure Standards.

The public consultation to obtain feedback from stakeholders on the two proposed IFRS Sustainability Disclosure Standards ended on July 29, 2022.

Key Takeaways

Tasks to help you prepare

• July 20 to 21, 2022 - First public meeting of the ISSB was held.

• The ISSB did not make any technical decisions at the first meeting. It did share feedback it has received so far from stakeholders regarding the two proposed IFRS Sustainability Disclosure Standards.

• July 29, 2022 was the last day of the public consultation on the two proposed IFRS Sustainability Disclosure Standards.

• ISSB’s next public meeting will be held in the week commencing September 19, 2022.

• Stakeholders continue to watch the developments with the ISSB closely as many country specific standards setters plan to develop their own standards based on the ISSB and its push for international coordination on sustainability rules including the U.S. Securities and Exchange Commission for its Climate Disclosure Rules and Canada’s Implementation Committee formed from the Accounting Standards Oversight Counsel (AcSOC) and Auditing and Assurance Standards Oversight Counsel (AASOC) Sustainability Standards Board (CSSB) on Standard Setting for its Canadian Sustainability Standards Board.