With multiple reporting bodies, voluntary and mandatory disclosures, and differing degrees of granularity, compliance with sustainability reporting can become extremely complex. But a recent announcement from the International Sustainability Standards Board (ISSB) may help ease the burden carried by reporting organization.
On June 24th, the ISSB revealed that it is implementing new measures to standardize sustainability reporting over the next two years. As part of these plans, the IFRS Foundation will assume responsibility for the Transition Plan Taskforce (TPT) disclosure framework, enabling the ISSB incorporate the TPT’s comprehensive guidance into its standards.
As part of the ISSB’s current climate disclosure standard (IFRS S2) firms are required to disclose any climate-related transition plans they have. The move to host the TPT disclosure material on their Sustainability Knowledge Hub, it will ensure that firms have clear steps for outlining their transition to a low-carbon economy, easing the reporting burden for climate and sustainability executives. In the longer term, the ISSB will consider enhancing this guidance, by leveraging the TPT-informed material to update their formal guidance.
The IFRS Foundation has also signed an agreement with The GHG Protocol aimed at ensuring compatibility between the organizations’ reporting standards. This partnership will work towards the goal of aligning global standards for measuring and reporting greenhouse gas emissions. The agreement means the ISSB will be actively engaged in updates and decisions made in relation to the GHG Protocol standards and guidance and includes the appointment of a representative of the ISSB as an observer on the GHG Protocol Independent Standards Board.
As the ISSB enacts these strategies over the next two years, it will continue to strengthen its goal of reducing the complexity of managing multiple sustainability reporting initiatives. Corporate decision-makers should keep a close eye on progress to take advantage of guidance and adapt to reporting changes as they occur.
