Over 350 people from 55 countries participated in this year’s IFRS Foundation Conference to engage with experts from the International Accounting Standards Board (IASB) and International Sustainability Standards Board (ISSB) as well as from the financial reporting landscape. This year, the event was held across two days with the first day dedicated to sustainability matters and the second day focusing on accounting matters. This summary provides an overview of the various discussions that transpired during this event.
This year’s conference featured a few key firsts:
In his opening remarks to welcome participants, Erkki Liikanen, the Chair of the IFRS Foundation Trustees, reflected on the similarities between what happened when the IASB was created in 2001 and the current developments since the formation of the ISSB in 2021.
The first keynote address was given by Ashley Alder, Board Chair of IOSCO. Mr Alder gave an overview of the role that the International Organization of Securities Commissions (IOSCO) played in the creation of the ISSB and referred to the widespread support from securities regulators for the establishment of a global baseline for sustainability disclosures. He also added that market regulators’ concerns about greenwashing were another driver for their support of the ISSB’s work to mitigate these risks and shore up trust in the whole area of sustainability finance. He then set out the criteria that IOSCO has been using to review the ISSB’s proposals before affirming its endorsement of the ISSB’s standards. Mr Alder concluded his speech by stressing the importance of bridging the divide between accounting standards and sustainability disclosure standards so that they complement each other and complete the picture of a company’s enterprise value and future prospects.
Chair of the ISSB Emmanuel Faber was the second keynote speaker. He highlighted the significant progress that the ISSB has been making since its creation. The ISSB published its first two proposed IFRS Sustainability Disclosure Standards in March 2022 and is currently seeking feedback on these. With the appointment of six further ISSB members over the past few weeks, the board is now quorate. The ISSB’s first public meeting is taking place in mid-July. While the ISSB has advanced on a number of fronts, Mr Faber pointed out that the next few months are going to see ramped up activity from the ISSB. He reiterated that the support from IOSCO was foundational for the work that the ISSB is doing to ensure that capital markets are operating well.
Mr Faber’s keynote address was followed by a panel session involving him, IASB Chair Andreas Barckow and ISSB Vice-Chair Sue Lloyd. Connectivity between the IASB and the ISSB was a key theme that emerged in their discussion and from the questions submitted by participants to the panellists. Overall, the panel agreed that connectivity between both boards is critical to avoid the risk of gaps or inconsistencies between sustainability disclosures and financial statements. There is much potential for both boards to learn from each other through ongoing discussions and collaborations on projects. Sue Lloyd cited taxonomy as an example of a connected area where one single team supports both boards. The team is now seeking stakeholder feedback on its staff draft of the IFRS Sustainability Disclosure Taxonomy.
The rest of the first day of the conference was devoted to a series of interactive workshops on the proposed IFRS Sustainability Disclosure Standards, addressing participants’ questions on the disclosure requirements. The day ended with a panel of experts exploring how technology is changing the way investors consume financial reports and make investment decisions. The discussions in this session underlined the importance of technology in providing both financial data and sustainability-related information in the most effective manner to capital markets.
Andreas Barckow used his keynote address to set the scene for the discussions which unfolded on the second day of the conference. He began his speech by reminding the audience of the progress being made to have a full number of IASB members before the end of this year. He then proceeded to share the IASB’s strategic decisions. Delegates heard that, consistent with the feedback obtained from stakeholders on its Third Agenda Consultation, the IASB has unanimously agreed to completing its current work plan as a matter of priority. It has also decided to add three projects to its work plan. These projects are intangible assets, the statement of cash flows and a maintenance project on climate-related risks in financial statements. Looking ahead, Mr Barckow said the IASB and the ISSB will work collegially together for the benefit of investors and other capital market participants. The stakeholder groups for both boards have widened and there is much that can be learnt from their perspectives, he said.
Following his keynote address, Mr Barckow joined IASB Executive Technical Director Nili Shah to present a detailed update on the IASB’s current projects. The session was followed by the IASB technical staff conducting interactive workshops with delegates, updating them on the latest developments on projects such as the Primary Financial Statements, the Post-implementation Review of IFRS 9 Financial Instruments as well as Dynamic Risk Management and the Financial Instruments with Characteristics of Equity projects. Separately, participants also learned how the IFRS Interpretations Committee supports the consistent application of IFRS Accounting Standards. External speakers from preparers and users of financial information joined IASB Member Nick Anderson to discuss how requirements in IFRS Accounting Standards require companies to consider climate-related matters (and other emerging risks) when their effects are material to financial statements.
The conference ended with an audience Q&A with Andreas Barckow and Nili Shah, chaired by IASB Member Mary Tokar. Delegates obtained answers to a wide range of questions relating to the IASB’s current work plan and strategic priorities.
The IFRS Foundation would like to thank all delegates and speakers for their participation and contributions to the conference. Recordings of some sessions will be made available on the IFRS website in the future.