IFRS releases resources to support sustainability reporting
July 28, 2023
The IFRS Foundation this week published a proposed disclosure taxonomy and a comparison guide, both designed to assist those preparing for implementation of new global sustainability standards.
The IFRS Foundation released multiple resources this week aimed at providing support for those charged with implementing global sustainability standards recently launched by its International Sustainability Standards Board (ISSB).
The ISSB has published its proposed IFRS Sustainability Disclosure Taxonomy, a tool that "is necessary to facilitate structured digital reporting of sustainability-related financial information prepared applying the ISSB standards," according to a news release.
The ISSB is seeking feedback on the proposals until 26 September. Comments can be submitted online. In addition, the board will host a webinar on Thursday to discuss the proposed taxonomy.
Also this week, the IFRS Foundation published a comparison of IFRS S2 and TCFD recommendations, concluding that those already using the Task Force on Climate-Related Financial Disclosures framework are ahead of the game.
"As demonstrated in this comparison, companies that apply the ISSB standards will meet the TCFD recommendations and so do not need to apply the TCFD recommendations in addition to the ISSB standards," a news release stated. "There are additional requirements in IFRS S2."
Sixty-three per cent of large companies around the world used the TCFD framework in 2021, according to data collected by the International Federation of Accountants and AICPA & CIMA, together as the Association of International Certified Professional Accountants.
Both the TCFD comparison guide and proposed taxonomy are steps forward in creating a support system related to IFRS S1 and IFRS S2.
"To create a system that provides high-quality, consistent reporting of sustainability-related disclosures, we need to develop the resources that enable accounting and finance professionals to strengthen their knowledge, skills, and processes that are needed to facilitate the implementation," said Ami Beers, CPA, CGMA, senior director—Assurance & Advisory Innovation at AICPA & CIMA. "Therefore, I think the next focus area needs to be building awareness and delivering guidance and education to companies of all sizes."
IOSCO endorses global sustainability standards
After extensive engagement with the ISSB over the last two years, the International Organization of Securities Commissions (IOSCO) endorsed IFRS S1 and IFRS S2.
"IOSCO has found that the ISSB conducted a robust process and have concluded that these standards serve as an effective and proportionate global framework of investor-focused disclosures on sustainability and climate-related risks and opportunities," IOSCO Chair Jean-Paul Servais said in a news release.
IOSCO's release calls on its 130 member jurisdictions to consider ways they might adopt, apply or otherwise be informed by the ISSB standards "within the context of their jurisdictional arrangements, in a way that promotes consistent and comparable climate-related and other sustainability-related disclosures for investors."
[Financial Management magazine]
