Businesses and investors have consistently advocated for clearer and simpler sustainability disclosure guidelines. Over the past few years, several significant milestones have been achieved to address this need for clarity. Those milestones involved collaborations and mergers among prominent framework providers and standard setters.

The snapshot below shows that except GRI and CDP, almost all of the standards are now under IFRS, which is aiming at integrating all standards into a single framework under the IFRS Foundation’s newly established ISSB. This initiative may significantly simplify and unify the process of disclosing sustainability practices for business, hence increasing the willingness of doing it.

About ISSB

Informed by its recent consultation on future priorities, the International Sustainability Standards Board (ISSB) will commence projects to research disclosure about risks and opportunities associated with:

1. biodiversity, ecosystems and ecosystem services; and

2. human capital.

As with the approach to the ISSB’s inaugural Standards, the ISSB will look at how it might build from relevant pre-existing initiatives. This includes those already under its analysis – the SASB Standards and CDSB guidance – and, additionally, relevant aspects of the work of the Task Force on Nature-related Financial Disclosures (TNFD).

The consolidation of various sustainability standards under the IFRS Foundation and the establishment of the ISSB marks a significant advancement in the clarity and simplicity of sustainability disclosures. The mergers of these standard frameworks in recent years indicate a future for sustainability disclosure frameworks that is more unified and less cumbersome.

These efforts are poised to streamline the reporting process, making it easier for businesses to communicate their sustainability practices and for investors to make informed decisions based on standardized and comparable data.

Please note:

1. The Financial Stability Board (FSB) is an international body that monitors and makes recommendations about the global financial system. More specifically, the FSB was established to: Assess vulnerabilities affecting the global financial system as well as to identify and review, on a timely and ongoing basis within a macroprudential perspective, the regulatory, supervisory and related actions needed to address these vulnerabilities and their outcomes.

2. IR Framework, CDSB, SASB, and VRF were consolidated into the IFRS Foundation to support the work of the newly established International Sustainability Standards Board (ISSB).

3. The Taskforce on Nature-related Financial Disclosures (TNFD) has developed a set of disclosure recommendations and guidance that encourage and enable business and finance to assess, report and act on their nature-related dependencies, impacts, risks and opportunities. (Its adopters)

   Snapshot of International ESG Standards and their interconnection