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ISSB sustainability disclosure standards: latest developments

The International Sustainability Standards Board (ISSB) has confirmed (see here) that:

  • Its climate disclosure standard will require company disclosures on Scope 3, as well as Scope 1 and Scope 2, greenhouse gas emissions.
  • It will develop relief provisions to help companies apply the Scope 3 requirements. The relief, which will be decided at a future meeting, could include giving companies more time to provide Scope 3 disclosures and working with jurisdictions on “safe harbour” provisions.
  • The ISSB disclosure standards will focus on meeting the information needs of investors. However, it has decided to modify certain language in the proposals that was not clearly understood, including removing the term “enterprise value” from the objective and the assessment of materiality and removing the term “significant” to describe which sustainability risks and opportunities to disclose. It will use the same definition of “material” as is used in the IFRS Accounting Standards and will discuss at a future meeting the need for further guidance on how to determine what is material information.
  • The ISSB has decided that it will focus its future work on two components: foundational work supporting the adoption and application of its first two disclosure standards; and new areas of work on which it will consult in the first half of 2023.
  • The foundational work will include providing supporting materials and developing a digital taxonomy to enable digital reporting; enhancing the SASB Standards to make them more internationally applicable; coordinating work with the International Accounting Standards Board to support connectivity in the two boards’ requirements and considering operability with the work of others including the GRI and EFRAG; and researching areas for potential incremental enhancements to its proposed climate standard.
  • The ISSB will consider its plans to build on the SASB Standards. This will include deliberating on the feedback to its proposals to include industry-based requirements, built on the SASB Standards, in its proposed climate standard.
  • The ISSB aims to complete deliberations on the first two disclosure standards around the end of 2022, with the view to issue the final standards as early as possible in 2023.

The ISSB has also indicated separately (see here) that, while it has no intention of deviating from its investor-focused remit, it is in a good position to fully align with the EU draft climate disclosure standard that is currently being developed by EFRAG, as well as progressing the ISSB’s collaboration with the GRI. According to ISSB chair Emmanuel Faber: "We are having very dense discussions with our European colleagues with a view to come as close as possible to an alignment of our climate standards [...] we are obviously going to stick in the remit of our financial materiality, but the substance is intended to be as close as possible and if possible, even fully aligned.” He also stated: "We are going to gradually develop a suite of solutions with GRI, where ISSB will be the pillar one of materiality on capital markets and economic decisions and GRI would be pillar two as impact, and the sum of that would be full materiality." Conversations with the GRI are said to be progressing and something concrete should be made public by the end of the year.

For more information on the ISSB and EFRAG disclosure standards, see: 


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