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International Sustainability Standards Board

The ISSB IFRS S1 and S2 are the first two International Sustainability Standards issued by the International Sustainability Standards Board (ISSB) in June 2023. They aim to bring consistency and transparency to how companies disclose sustainability-related information in their financial reports.

Here's a breakdown of each standard:

  • Provides a framework for companies to disclose material sustainability-related risks and opportunities that could affect their financial prospects.
  • Requires companies to use industry-specific Sustainability Accounting Standards Board (SASB) Standards (unless superseded by future ISSB standards) to report beyond climate-related information.

Defines the information companies need to disclose, including:

  • Nature and extent of sustainability-related risks and opportunities.
  • Management approach to these risks and opportunities.
  • Metrics and targets used to assess performance.

Significance of IFRS S1 and S2

These standards are a major step towards standardising sustainability reporting worldwide. They can benefit investors and other stakeholders by providing comparable and reliable information about companies' sustainability performance. Companies are required to apply IFRS S1 and S2 for reporting periods beginning on or after January 1, 2024.