The International Sustainability Standards Board (ISSB) has issued its inaugural standards, FRS S1 and IFRS S2.
IFRS S1 is based around General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 is based on Climate-related Disclosures.
IFRS S1 provides a set of disclosure requirements designed to enable companies to
communicate to investors about the sustainability-related risks and opportunities they face over the short, medium and long term.
IFRS S2 sets out specific climate-related disclosures and is designed to be used with IFRS S1.
For the first time, the standards create a common language for disclosing the effect of
climate-related risks and opportunities on a company’s prospects.
The standards will be officially launched by ISSB chair Emmanuel Faber at the IFRS
Foundation’s annual conference today and through a week of events hosted by stock exchanges around the world,
The Association of International Certified Professional Accountants (AICPA) and the Chartered Institute of Management Accountants (CIMA) have both praised the new standards.
Barry Melancon, CPA, CGMA, the CEO of AICPA and CIMA, said: “Clear, consistent and globally accepted reporting standards are essential for high quality sustainability accounting, and the disclosure baselines released today move us closer to that goal. We’re in a new era in corporate reporting.
“Investors, lenders, regulators and other stakeholders are demanding broader sets of business information, and capital markets are looking for the same level of rigour in reporting for sustainability as for financial information. As this global framework matures, we expect professional accountants to play a critical role in delivering consistency and trust in both sustainability reporting and assurance.”
AICPA and CIMA are among the sponsors of a forum at the New York Stock Exchange.
Liam J Moran writes in Accountancy Today