The International Sustainability Standards Board (ISSB) today announced the formation of a working group of jurisdictional representatives to establish dialogue for enhanced compatibility between the ISSB’s exposure drafts that are currently open for comment and ongoing jurisdictional initiatives on sustainability disclosures. The formation of the working group is part of an extensive programme of outreach activity designed to encourage feedback on and engagement with the ISSB’s consultation from all jurisdictions and stakeholder groups.
The ISSB’s mission is to deliver a high-quality global baseline of sustainability disclosures, which includes an initial focus on detailed climate requirements. The global baseline addresses the needs of capital market participants around the world and can be directly used on a voluntary basis by market participants or incorporated into jurisdictional mandatory requirements (which might also serve broader public policy or multistakeholder needs). The ISSB will operate in an inclusive manner in this mission.
Jurisdictional standard-setting in the field of sustainability-related financial disclosures is a relatively new discipline and many jurisdictions are participating in this process at scale for the first time. Many of these developments and associated public consultations are occurring in parallel.
These ongoing activities present an opportunity to align, as much as possible, requirements at a jurisdictional and international level to deliver the global baseline that has been welcomed by public authorities and market participants, including the G20, the G7, the International Organization of Securities Commissions and the Financial Stability Board.
A new advisory body—the Sustainability Standards Advisory Forum—will be created by the ISSB during the next quarter to facilitate regular dialogue with, and high-level advice from, a broad set of jurisdictions.
In addition, to support timely development of the global baseline, the ISSB has formed a working group composed of representatives from several jurisdictions actively engaged in standard-setting in the field of sustainability disclosures. The working group will discuss compatibility of those initiatives to establish how the global baseline, fully responding to the needs of global market participants, can contribute to optimising reporting efficiency for companies in those jurisdictions and how those jurisdictions can build upon the global baseline according to their needs.
Members of the working group are the Chinese Ministry of Finance, the European Commission, the European Financial Reporting Advisory Group, the Japanese Financial Services Authority, the Sustainability Standards Board of Japan Preparation Committee, the United Kingdom Financial Conduct Authority and the US Securities and Exchange Commission.
Working group meetings will take place in May and July. Meeting summaries will be published on the IFRS Foundation website. Input from the working group will also be considered by the ISSB in public meetings as part of its deliberation of all feedback received during the consultation period.
Commenting on the working group meetings, Emmanuel Faber, ISSB Chair, said:
There is strong public interest in seeking to align where possible the international and jurisdictional requirements for sustainability disclosures. We have a window of opportunity to do just that, given that the ISSB’s proposals are out for comment at the same time as several major jurisdictions are also seeking public input on their proposals. I look forward to a fruitful exchange of ideas.