You will also continue to see news headlines about
jurisdictions preparing to adopt the ISSB Standards. Preceding and soon after the launch of the ISSB Standards, consultations kicked off in Hong Kong, Australia, Singapore, and the United Kingdom, and we can expect many more. Meanwhile, companies are gearing up for voluntary application of the ISSB Standards, no matter where they’re based. Why do the ISSB Standards matter for U.S.- based companies facing the prospect of an SEC climate disclosure rule, new climate disclosure requirements in California, and perhaps the European Union Sustainability Reporting Stan- dards (ESRS)? U.S. companies are coming to see voluntary use of the ISSB Standards as their “no regrets” strategy for investor-grade reporting on climate risk and other sustainability topics. Trough voluntary use of internationally accepted, investor-focused disclosure standards, such companies are well-prepared for the transition to mandatory reporting. Te ISSB Standards also enable U.S. companies
to be part of the global baseline, reducing fragmenta- tion in disclosure frameworks, and thereby reducing duplication and cost. Meeting the immediate needs of investors who have long asked for SASB Standards and TCFD disclosures, the ISSB Standards serve as a bridge to disclosure requirements in Europe and other jurisdictions around the world where they operate.
After years of struggling to navigate the alphabet soup of standards and frameworks, ratings and rankings, questionnaires and surveys, some may react, “Not another framework!” Te ISSB Standards aren’t for just another chap- ter in the company sustainability report or the sustainability section of the corporate website. We are in a new era of corporate sustainability, and the ISSB Standards are its new common language, con- necting sustainability disclosure to financial report- ing, and fostering investor-company dialogue. IR
Elizabeth Seeger is a member of the International Sustainability Standards Board (ISSB). Prior to joining the ISSB, Ms. Seeger was managing director of sustainable investing at global investment firm KKR.
niri.org/ irupdate IR UPDAT E ■ FA L L 2 0 2 3 2 7 A Summer of Milestones I
n recent months, there were five key announcements that investor relations professionals need to know about. June 26: The ISSB issued IFRS S1 and IFRS S2, our inaugural standards, with launch celebrations at stock exchanges around the world. July 6: The Financial Stability Board announced that the work of the TCFD has concluded, citing the ISSB Standards as the “culmination” of its work, and transferred responsibility for monitoring progress on climate-related disclosures to the ISSB as of 2024. July 25: The International Organization of Securities Commissions (IOSCO) endorsed the ISSB Standards following a comprehensive review and is now calling on its 130 member jurisdictions—regulating over 95% of the world’s securities markets—to consider how they can incorporate the ISSB Standards into their respective regulatory frameworks. July 27: The ISSB published for public comment a proposed digital taxonomy (XBRL tagging for sustainability data). That might sound highly technical compared to the other announcements, but such a taxonomy enables easy digital consumption of sustainability reports, ensures the quality of data throughout its lifecycle, and can support interoperability between standards and jurisdictions. July 31: The European Sustainability Reporting Standards (ESRS) were issued. The European Commission, the European Financial Reporting Advisory Group (EFRAG), and the ISSB issued a statement about their joint efforts to improve interoperability of their respective climate-related disclosure requirements, noting that it has resulted in a very high degree of alignment, and reduced duplication and complexity for companies wishing to apply both the ISSB Standards and the ESRS.
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