Zoe Christodoulou
In an ever-evolving world where environmental, social, and governance (ESG) concerns are at the forefront, the demand for unified global sustainability standards has never been more pressing. The International Sustainability Standards Board (ISSB), is tasked to revolutionize how we measure, report, and manage sustainability on a global scale.
The goal? To forge a common language for sustainability reporting that transcends borders and unites us all in the quest for a better, more sustainable world.
How? On 26 June 2023, ISSB unveiled its inaugural global sustainability disclosure standards, IFRS S1 and IFRS S2 (ISSB Standards).
The ISSB Standards: Breaking It Down
- IFRS S1: General Requirements for Disclosure of Sustainability-related Financial Information. IFRS S1 compels organizations to reveal their sustainability-related risks and opportunities to empower decision-makers to invest wisely and responsibly.
- IFRS S2: Climate-related Disclosures.
IFRS S2 mandates that businesses disclose their climate-related risks and opportunities. This means investors can determine if their investments align with their environmental principles.
While the ISSB Standards aren't obligatory, it's highly anticipated that they'll be integrated into mandatory reporting frameworks by jurisdictions beginning on or after January 1, 2024.
Why Should You Care About ESG?
ESG is no longer a side note; it's centre stage in business strategies and investment decisions. The urgency of addressing global sustainability issues is a call we can't ignore. The lack of standardized reporting has caused inconsistency, bred greenwashing, and shaken our trust in sustainability claims. But that's where ISSB steps in.
By establishing globally applied standards, ISSB is raising the bar for transparency, responsibility, and accountability. Investors, stakeholders, and consumers will finally have a consistent, comparable metric to guide their ethical decision-making. And, as we address global sustainability challenges like climate change and social inequality, we pave the way to a more sustainable, equitable world. Further, standardized reporting fosters innovation in sustainability practices, reducing our environmental and social footprint.
Europe's Sustainability Mandate
Europe is leading the change with the Corporate Sustainability Reporting Directive (CSRD), which came into effect on January 5, 2023. The CSRD expands mandatory sustainability reporting, affecting more significant corporations and listed SMEs. Under the CSRD, the European Commission introduced the European Sustainability Reporting Standards (ESRS) on 31 July 2023. Reporting obligations will commence between 2024-2028, depending on the type of institution.
Our Conclusion
The ISSB Standards are not just about numbers and reports; they are about shaping a future where sustainability is not just a goal but a global reality. The standards are a promise that transcends borders, uniting us in a shared vision of a better, more sustainable world. Together, we are pioneering a path to lasting change.
How we can Help
Our comprehensive Sustainability/ESG solutions’ package includes:
- Current State & Materiality Assessment
- Sustainability/ESG Strategy
- Reporting & ESG Disclosures
- Gap Analysis
- Governance and Management Systems Development
- Standards’ Integration and Alignment
- Stakeholder Engagement
- EU taxonomy, CSRD, SFDR data alignment
- Training: ESG fundamentals for Businesses as well as advanced, internationally certified training courses
* This publication has been prepared as a general guide and for information purposes only. It does not purport to be comprehensive or to render professional advice. Before making any decision or taking any action that may affect you and/or your business, bespoke advice should be obtained.