Financial Reporting Council (FRC), UK has published its thematic review of climate-related metrics and targets. The review considers the TCFD metrics and targets disclosures of twenty UK premium and standard listed companies operating in four sectors (materials and buildings, energy, banks and asset managers) covered by TCFD sector-specific supplemental guidance.
Overall observations of the review include:
The thematic review may be accessed here.
The International Organisation of Securities Commissions (IOSCO) has announced its endorsement of ISSB’s Sustainability Disclosure Standards – IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures.
IOSCO has noted that after a detailed analysis, it has determined that the ISSB Standards are appropriate to serve as a global framework for capital markets to develop the use of sustainability-related financial information in both capital raising and trading and for the purpose of helping globally integrated financial markets accurately assess relevant sustainability risks and opportunities.
IOSCO has called on its 130 member jurisdictions, regulating more than 95% of the world's financial markets, to consider ways in which 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.
Erkki Liikanen, the Chair of IFRS Foundation Trustees, in his statement, has observed that IOSCO’s endorsement sends a powerful signal to jurisdictions worldwide, providing them with the confidence they need to implement the ISSB Standards in their regulatory frameworks.
The endorsement announcement from IOSCO may be accessed here.
The statement from Erkki Liikanen on the IOSCO’s endorsement of the ISSB Standards may be accessed here.
The European Commission has adopted the ESRS under the CSRD, marking a major step towards the implementation of the law, with reporting set to begin for some companies as soon as the 2024 financial year. The press release may be accessed here. The press release notes that the ESRS take account of discussions with the ISSB and the Global Reporting Initiative (GRI) in order to ensure a very high degree of interoperability between EU and global standards and to prevent unnecessary double reporting by companies.
In a Statement, Jean-Paul Servais, Chair of IOSCO, has welcomed the European Commission’s adoption of the ESRS and, in particular, the announcement by the European Commission that it has integrated the ISSB Standards into them.
The IFRS Foundation has published a Statement providing an update on their discussions around alignment and interoperability between ESRS and the ISSB Standards. The statement notes that the work jointly undertaken by the European Commission, EFRAG and the ISSB to improve the interoperability of their respective climate-related disclosure requirements has led to a very high degree of alignment, reduced complexity and duplication for entities wishing to apply both the ISSB Standards and ESRS.
EFRAG has published an assessment on the interoperability between ESRS 2 General Disclosures and ESRS E1 Climate and IFRS S1 & S2 and to provide a supporting mapping table. The assessment and the climate-related disclosures mapping table is a contribution to the ongoing joint work with the ISSB on interoperability guidance on ESRS and ISSB standards.
The assessment may be accessed here.
The International Auditing and Assurance Standards Board (IAASB) has issued an exposure draft for the ISSA 5000, General Requirements for Sustainability Assurance Engagements. When approved, ISSA 5000 will be the most comprehensive sustainability assurance standard available to all assurance practitioners across the globe. The standard was drafted to work with existing reporting framework and those under development, including but not limited to those issued by the EU, ISSB, GRI, ISO, and others.
The exposure draft may be accessed here. Stakeholders have until December 1 to provide feedback and insights. The final standard will be issued before the end of 2024.