The IFRS Foundation Trustees (Trustees) and the IFRS Foundation Monitoring Board (Monitoring Board) today agreed to an updated Memorandum of Understanding (MoU). The updates to the MoU reflect developments in the work of the IFRS Foundation, most notably the establishment of the International Sustainability Standards Board (ISSB) as a sister board to the International Accounting Standards Board (IASB).
The IFRS Foundation has a three-tier governance model. The IASB and ISSB are independent standard-setting boards, overseen by a body of Trustees responsible for strategy, funding and due process oversight of the boards. The Trustees are in turn publicly accountable to the Monitoring Board of capital market authorities responsible for setting the form and content of corporate reporting in their respective jurisdictions.
The governance arrangements fulfil an essential role in maintaining global confidence in the work of the IFRS Foundation and its standard-setting process—with the role of the Monitoring Board playing a vital role in the governance arrangements.
The updates to the MoU reflect the formation of the ISSB and other innovations since the agreement of the first MoU in 2009.
Commenting on the agreement, IFRS Foundation Trustee Chair Erkki Liikanen said:
The role of the Monitoring Board is essential to the effective functioning of the IFRS Foundation, and in recent years it has played a vital role in the oversight of the Trustees and the establishment of the ISSB.
I commend the Monitoring Board for the completion of this agreement on a timely basis and look forward to continuing this relationship into the future.
Takashi Nagaoka, Chair of the IFRS Foundation Monitoring Board said:
With the updated MoU, the Monitoring Board confirms its renewed commitment to ensuring the public accountability of the IFRS Foundation by continuously monitoring and reinforcing the public interest oversight function of the Foundation, as well as promoting the continued development of IFRS Standards as high-quality sets of global accounting standards and global sustainability disclosure standards.
We look forward to continued collaboration with the Trustees to serve the public interest.