Chair of the IFRS Foundation Trustees (Trustees) Erkki Liikanen outlines the current state of appointments to the ISSB.
Work continues to establish the inaugural membership of the International Sustainability Standards Board (ISSB), following the announcement of its formation at the November 2021 COP26 climate conference. This work is being undertaken by the Nominating Committee of the IFRS Foundation Trustees, ably chaired by my fellow Trustee Michel Madelain.
Our first task has been to establish the leadership of the ISSB. Emmanuel Faber took up his position as ISSB Chair in January 2022, and IASB Vice-Chair Sue Lloyd will step down from her current role to become ISSB Vice-Chair in March 2022. Janine Guillot has also been appointed to serve as a Special Advisor to the ISSB Chair, whilst a further Special Advisor from the Asia-Oceania region is expected to be appointed who will focus on the ISSB’s engagement with developing and emerging economies, as well as with smaller companies.
With the leadership largely in place, attention has now turned to the appointment of the remaining 12 ISSB members. The recruitment process is being guided by an executive search firm appointed by the Trustees. Thus far, the process has delivered an excellent selection of highly qualified candidates, and we welcome further applications. Full role specifications for ISSB members and details for how to apply are available here.
The Trustees have decided to sequence the appointment process for the remaining board positions. There is strong stakeholder demand for the ISSB to publish final requirements in a timely manner based on the prototype climate and general sustainability disclosure requirements also published at COP26, subject to the appropriate due process.
The IFRS Foundation Constitution affords the ISSB the option to publish exposure drafts for public comment when approved by its Chair and Vice-Chair, and subject to oversight by the Trustees’ Due Process Oversight Committee. However, a quorum of eight members must be in place for the ISSB to deliberate on feedback received on the exposure drafts and for final requirements to be published.
Therefore, our priority as Trustees is to appoint a further six board members (in addition to the already appointed Chair and Vice-Chair), thus ensuring a quorum of board members with balanced representation will be in place and ready to finalise the first technical outputs. Preparations are already underway to ensure this first batch of appointments are completed in the coming months. Once a quorum is in place, attention can turn to completing the remaining six appointments that will provide the full Board of 14 members. We expect the ISSB recruitment process to be fully completed by the third quarter of 2022.
The complete Board will represent a professionally and geographically diverse group of senior experts— including preparers, investors, standard-setters, regulators, auditors, specialists in environmental and other sustainability matters and academics—who have experience in sustainability and its reporting. Particular attention will be paid to the representation of emerging economies and smaller companies. A similar approach is being taken to determining the membership of the Sustainability Consultative Committee and the Sustainability Standards Advisory Forum—two key advisory bodies to the ISSB, where work on their formation is also underway.
This sequenced approach will allow us, at each step, to build further the diversity and breadth of profiles and expertise which will ensure the ISSB is truly global and inclusive and has the skills necessary to set standards that will provide a global baseline of sustainability-related disclosures to meet the needs of investors and the capital markets. It will also ensure the ISSB is able to move at the pace required by stakeholders, in full compliance with the requirements of our Constitution, and to deliver the thorough and inclusive due process expected of the IFRS Foundation and its work.