ICAEW.com works better with JavaScript enabled.

Sustainability standards on track for Q2 2023 issuance

Author: ICAEW Insights

Published: 14 Mar 2023

ISSB ramps up activities to support global implementation as it prepares for inaugural standards to be issued in the summer.

The International Sustainability Standards Board (ISSB) has finalised all the technical content of its initial Sustainability Disclosure Standards and is preparing to enter a drafting and formal ‘balloting’ process ahead of their expected issuance by the end of June this year.

Following an extensive consultation last year and with the substance of the Standards now fully agreed, the ISSB says it will focus efforts on developing further guidance and training material, and work with partners to deliver a core capacity-building programme across different economic settings.

The ISSB says help for emerging and developing economies and smaller companies will be delivered using structured partnerships that leverage specialist expertise to build local understanding for the implementation of the standards. In December 2022, the ISSB announced a package of reliefs and guidance to support Scope 3 disclosures, enabling companies to scale up their approach to using the Standards over time.

The ISSB’s initial IFRS Sustainability Disclosure Standards – S1 on general sustainability-related disclosures and S2 on climate-related disclosures – will become effective from January 2024. The swift introduction responds to demand from investors for companies globally to disclose comprehensive, consistent and comparable sustainability-related information. 

However, before the Standards are adopted for use in the UK, they must complete an endorsement process – a process yet to be consulted on by the UK government.

The ISSB is also working with the European Commission and EFRAG toward a shared objective of maximising interoperability of the ISSB’s Standards and the European Sustainability Reporting Standards (ESRS), including alignment on key climate disclosures. The ISSB has voted to reference ESRSs within an appendix to S1 as a source of guidance that companies may wish to consider, to identify metrics and disclosures if they meet the information needs of investors. Joint work will now focus on detailed terminology within the standards, to be completed with the finalisation of both sets of standards.

In addition, the ISSB is currently engaging with a number of other jurisdictions and organisations active in sustainability standard-setting to support the interoperability of its global baseline of cost-effective, decision-useful Standards, and to prepare for their effective roll-out.

Commenting, ISSB Chair Emmanuel Faber said setting a 2024 effective date is consistent with capital market and G20 demand for a common language of investor-focused sustainability-related disclosure: “Now, we will work with regulators around the world as they play their part, creating the conditions within their markets for adoption, so that investors can use comparable information about sustainability-related risks and opportunities in their investment decisions without delay,” he said. He added that the ISSB would actively engage with the many preparers who are considering voluntary adoption of S1 and S2, to better answer their investor needs.

“As requested by our stakeholders, we have built from existing market-accepted frameworks and standards. This means that the thousands of companies already using the TCFD Recommendations and SASB Standards will be in a strong position to use S1 and S2,” Faber added.

The ISSB will deliver a keynote speech at ICAEW’s forthcoming Corporate Reporting Conference, as the world of climate-related and sustainability reporting continues to evolve at a pace. Taking place in London on 13 June, the half-day, in person-only event will assess where we’re at with sustainability reporting requirements and look at what’s coming over the horizon. 

Sally Baker, Head of Corporate Reporting Policy at ICAEW, said: “The issue of the ISSB’s first Standards will herald a significant milestone in the corporate reporting landscape. ICAEW’s Financial Reporting Faculty is delighted to be welcoming the ISSB to our 2023 Conference at such a timely moment for the profession. We hope many of you will join us as we explore what these developments mean for reporters, investors and other stakeholders.”

  • Register your interest to be the first to hear when ICAEW’s Corporate Reporting Conference is available to book, and to enjoy early bird discounts.
  • Join the Financial Reporting Faculty to have corporate reporting resources delivered straight to your inbox and to stay ahead of all the latest developments, including in sustainability reporting. Membership is at no additional cost for ICAEW members. Charges apply for non-ICAEW members.

Join our sustainability community

Join professionals with a collective ambition to deliver a #sustainable world. Membership of our Sustainability and Climate Change Community is free and open to everyone.

Sustainability & Climate Change polaroid

Latest on the energy crisis

Recommended content

Insights special
Gas-fired power station and factory building at night.
Energy crisis

A look at how supply difficulties, rising electricity prices and sanctions against Russia are contributing to turmoil in energy markets and an examination of what businesses can do to lessen the impact.

Read more
ICAEW Community
Energy & Natural Resources polaroid
Energy & Natural Resources

Tailored content and networking opportunities for accounting and finance professionals in the energy sector, to help you stay up to date with the latest news and developments in your industry.

Find out more
Trusted business advice
Logo of ICAEW's Business Advice Service
ICAEW Business Advice Service

The Business Advice Service connects owners of SMEs with ICAEW regulated firms who will provide a free initial consultation, without obligation.

Find out more