IFRS announces measures for harmonization of ESG reporting

The International Sustainability Standards Board (ISSB) of the IFRS Foundation has announced a series of measures aimed at harmonizing sustainability reporting requirements for companies, focusing on areas such as the disclosure of corporate climate transition plans and the measurement of greenhouse gas emissions across the value chain.

The IFRS (International Financial Reporting Standards) are important for asset valuation because they ensure transparency, consistency, and comparability in financial reporting worldwide, enabling investors and other stakeholders to make better-informed decisions. Additionally, they reduce uncertainty and risk through a uniform approach to asset valuation, strengthening confidence in financial markets.

Aviva Group Chief Executive Officer and Transition Plan Taskforce Co-Chair Amanda Blanc DBE said: 'Companies developing and disclosing transition plans need clear and consistent guidance. Today’s announcement that the International Sustainability Standards Board will look to use the resources we have developed in the Transition Plan Taskforce is brilliant news and an important step towards greater consistency and clarity.'

The ISSB was launched in November 2021 during the COP26 climate conference, with the goal of developing IFRS Sustainability Disclosure Standards, driven by demand from investors, companies, governments, and regulators to provide a global baseline of disclosure requirements, enabling a consistent understanding of the effects of sustainability risks and opportunities on companies' prospects. One of the key goals of the ISSB was to reduce the complexity of multiple sources of sustainability reporting initiatives. At launch, the ISSB consolidated the Climate Disclosure Standards Board (CDSB), the International Integrated Reporting Council (IIRC), and the Sustainability Accounting Standards Board (SASB). Last year, the IFRS Foundation announced that it would take over the responsibility for monitoring the progress of companies' climate-related disclosures from the Financial Stability Board's (FSB) Task Force on Climate-related Financial Disclosures (TCFD).

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