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21 February 2023
Elizabeth Pfeuti
February 21, 2023
The International Financial Reporting Standards Foundation’s (IFRS’) new global sustainability and climate disclosure standards will come into effect in January 2024.
On February 16, the International Sustainability Standards Board (ISSB) unanimously agreed on the implementation date during a review of the two reporting standards - the IFRS S1 General Requirements for Disclosure and Exposure Draft and IFRS S2 Climate-related Disclosures.
Drafts of the reporting standards were first released in March 2022 and have now been amended to include final decisions on the technical content of the new standards.
The standards will implement a “core baseline” level of sustainability reporting to meet the market’s needs and unify disclosures.
They have also been designed to ensure individual countries’ standards boards and regulators can adapt them to meet their own jurisdiction’s requirements.
Following the ISSB’s decision, all entities will be required to file reports under the two standards from early 2025.
The 2024 effective date also responds to strong demand from investors for companies to disclose sustainability-related information.
Emmanuel Faber, chair of the ISSB, said: “We responded to the capital market and G20 demand for a common language of investor-focused sustainability-related disclosure, working diligently to deliver standards that fulfil the global baseline. Setting a 2024 effective date is consistent with this demand.”
Following the announcement, the ISSB will prepare to release finalized standards by developing further guidance and training material.
The board will also work with partners on the delivery of a core capacity-building program across different economic settings.
The global aspect of the IFRS’ disclosure regulations strengthens the ISSB’s aim to develop a global presence, which it has been working on expanding lately.
In January, the ISSB announced it had signed an agreement with China’s Ministry of Finance to open an office in Beijing.
