The International Sustainability Standards Board (ISSB) is a standard-setting body established in 2021–2022 under the IFRS Foundation, whose mandate is the creation and development of

sustainability Sustainability is a social goal for people to co-exist on Earth over a long period of time. Definitions of this term are disputed and have varied with literature, context, and time. Sustainability usually has three dimensions (or pillars): env ...

-related financial reporting standards to meet investors' needs for sustainability reporting.

Background

In principle, sustainability-related disclosures have always been at least potentially part of financial reporting, given

financial risk Financial risk is any of various types of risk associated with financing, including financial transactions that include company loans in risk of default. Often it is understood to include only downside risk, meaning the potential for financi ...

s associated with sustainability matters. In practice, however, they have not always been a priority of the

accounting Accounting, also known as accountancy, is the process of recording and processing information about economic entity, economic entities, such as businesses and corporations. Accounting measures the results of an organization's economic activit ...

and financial reporting community. With growing awareness of sustainability challenges and especially

climate change Present-day climate change includes both global warming—the ongoing increase in Global surface temperature, global average temperature—and its wider effects on Earth's climate system. Climate variability and change, Climate change in ...

, the need for a specific framework for sustainability-related disclosures has been recognized by

environmentalist Environmentalism is a broad Philosophy of life, philosophy, ideology, and social movement about supporting life, habitats, and surroundings. While environmentalism focuses more on the environmental and nature-related aspects of Green politics, g ...

s, standard setters, reporting companies and the financial industry.

CDSB, IIRC, SASB, VRF

The Climate Disclosure Standards Board (CDSB) was formed in 2007 in London as part of the Carbon Disclosure Project that began in 2002. The International Integrated Reporting Council (IIRC) was formed in London in August 2010 with the participation of several stakeholders including the Global Reporting Initiative, International Accounting Standards Board, U.S.

Financial Accounting Standards Board The Financial Accounting Standards Board (FASB) is a private standard-setting body whose primary purpose is to establish and improve Generally Accepted Accounting Principles (GAAP) within the United States in the public's interest. The Secur ...

, International Organization of Securities Commissions, and International Federation of Accountants. Separately, the Sustainability Accounting Standards Board (SASB) was created in 2011 in

San Francisco San Francisco, officially the City and County of San Francisco, is a commercial, Financial District, San Francisco, financial, and Culture of San Francisco, cultural center of Northern California. With a population of 827,526 residents as of ...

with a focus on U.S. securities disclosures. In June 2021, the IIRC and SASB announced their combination to form the Value Reporting Foundation (VRF).

Creation and early development

The creation of the ISSB was announced at the 2021 United Nations Climate Change Conference ( COP26) in

Glasgow Glasgow is the Cities of Scotland, most populous city in Scotland, located on the banks of the River Clyde in Strathclyde, west central Scotland. It is the List of cities in the United Kingdom, third-most-populous city in the United Kingdom ...

in November 2021. Simultaneously, the IFRS Foundation announced it would consolidate the VRF and CDSB with the ISSB by June 2022. The IFRS Foundation announced the appointment of Emmanuel Faber as ISSB Chair in December 2021, and of Sue Lloyd as ISSB Vice-Chair in January 2022. In late March 2022, the ISSB published its first two exposure drafts, on climate and general sustainability-related financial disclosures respectively. In addition to the IIRC and SASB teams based in London and San Francisco, the ISSB is recruiting staff resources in

Frankfurt Frankfurt am Main () is the most populous city in the States of Germany, German state of Hesse. Its 773,068 inhabitants as of 2022 make it the List of cities in Germany by population, fifth-most populous city in Germany. Located in the forela ...

, where its Chair and Vice-Chair are based, and in

Montreal Montreal is the List of towns in Quebec, largest city in the Provinces and territories of Canada, province of Quebec, the List of the largest municipalities in Canada by population, second-largest in Canada, and the List of North American cit ...

. In June 2023, it opened another office in

Beijing Beijing, Chinese postal romanization, previously romanized as Peking, is the capital city of China. With more than 22 million residents, it is the world's List of national capitals by population, most populous national capital city as well as ...

Standards

ISSB standards will be part of the broader body of International Financial Reporting Standards (IFRS) and are to be known as IFRS-S ("S" for sustainability) to distinguish them from the accounting standards issued by the ISSB's sister body, the International Accounting Standards Board.

References

{{Authority control Sustainability organizations International sustainability organizations International Financial Reporting Standards

Background

CDSB, IIRC, SASB, VRF

Creation and early development

Standards

See also

References