The International Sustainability Standards Board (ISSB) has announced it will prioritise climate-related disclosures in its package of transitional reliefs to support companies applying its first two Standards – S1 (general requirements) and S2 (climate). In the first year of reporting using the ISSB Standards, companies will be incentivised to prioritise putting in place reporting practices and structures to provide high-quality, decision-useful information about climate-related risks and opportunities. In the second year companies will be required to provide full reporting on sustainability-related risks and opportunities beyond climate. The organisation has also decided that companies that only report on climate-related risks and opportunities in the first year will not need to provide comparative information. The full package of reliefs means for the first year that companies are using the ISSB Standards they do not need to provide disclosures about sustainability-related risks and opportunities beyond climate-related information, provide annual sustainability-related disclosures at the same time as the related financial statements, or disclose Scope 3 (indirect) greenhouse gas emissions. Companies will still need to apply S1 in the first year they use the ISSB Standards to meet general disclosure requirements where they relate to climate which are relevant to the disclosure of climate-related information. The ISSB’s S1 and S2 will be issued towards the end of Q2 2023. Next month, the ISSB expects to consult on its future priorities for standard-setting and will be seeking feedback on four projects – biodiversity, human capital, human rights and integration in reporting.
The #ISSB has decided to introduce a relief that will enable companies to focus initial efforts on ensuring they meet investor information needs around climate change.
— IFRS Foundation (@IFRSFoundation) April 5, 2023