Review the press release on the IAASB's website.

On the topic of connectivity, the standard setters highlight that close alignment and connectivity between financial and sustainability reporting is paramount to ensure that the information produced for investors is compatible and comparable. They also note that communicating the ISSB’s long-term objectives and clarifying how these relate to the IASB’s roadmap was a critical next step.

The standard setters submitted individual responses to the ISSB agenda consultation, but felt that it was necessary to combine their statements in an additional joint letter given their shared concerns:

• Feedback from UK stakeholders, as well as the UKEB’s own research, indicate that close alignment and connectivity between financial and sustainability reporting should be a priority for both Boards and they do not consider that this is yet complete.
• The AcSB strongly encourages the ISSB to continue working together with the IASB to prioritise issues related to connectivity in reporting.
• The MASB is of the view that connectivity is paramount to ensure high quality and compatible information in financial statements and in sustainability disclosures.
• The Australian Accounting Standards Board recommends that the ISSB focus on the development of additional guidance on connectivity to better support comparability.
• The XRB highlights that simply relying on generic aspirations for ‘connectivity’ or ‘interoperability’ may undermine the credibility of the work of the ISSB.

Access the report on the UKEB website.

• Amplified Engagement through Stakeholder Survey: Recognizing the diverse perspectives and levels of expertise within the stakeholder community, an alternative avenue for feedback has been developed. In addition to the comprehensive Explanatory Memorandum and Response Template, the IAASB has created a stakeholder survey. This user-friendly tool allows the IAASB to obtain the views of stakeholders who may not ordinarily respond to IAASB consultations, including preparers of sustainability information, those with the oversight of its preparation, investors and other users of the sustainability information, sustainability reporting standard setters and members of the academic community. Survey responses will be aggregated and analyzed in conjunction with other feedback received.
• Webinars for Enhanced Understanding: Learn more about ISSA 5000 at dedicated IAASB webinars for practitioners and regulators.
• Empowering Global Exchange at Notable Events: Events leading to opportunities for learning, sharing, and networking.

Re­view the webinar schedule on IAASB’s website.

The first report Climate-Related Matters: Summary of Connectivity Research provides an overview of recent third-party research into connectivity challenges between TCFD disclosures (a proxy for the disclosures required by IFRS S2) and the financial statements.

The research revealed:

• There is an overall lack of connectivity between climate-related narrative disclosures and their associated disclosures in the financial statements.
• While there has been an increase in the occurrence of climate-related disclosures the quality of disclosures remains low.
• More transparency is required regarding climate-related estimates and judgements used to prepare financial statements.

The second report A Study in Connectivity: Analysis of 2022 UK Company Annual Reports provides a deep-dive analysis from an investor’s perspective of potential connectivity challenges and includes stakeholder feedback on possible causes.

Access the two reports on the UKEB website.

• Climate-Related Matters: Summary of Connectivity Research
• A Study in Connectivity: Analysis of 2022 UK Company Annual Reports

The National Standard-setters (NSS) noted three key areas of concern for the ISSB to consider:

• Connectivity with accounting standards – all considered that close alignment and connectivity between financial and sustainability reporting is paramount to ensure that the information produced for investors is compatible and comparable.
• Strategic roadmap – communicating the ISSB’s long-term objectives and clarifying how these relate to the IASB’s roadmap was a critical next step.
• Implementation priority – the highest priority of the ISSB should be the successful implementation of the inaugural standards.

Access the letter on the UKEB website.

This year, it is titled "Delivering Impact in a Time of Complexity", marking the eleventh instalment of the ‘Reporting matters’ publication. It introduces an evolved evaluation framework designed to guide companies in an era of rapidly evolving reporting regulations and increased stakeholder expectations.

Access the report on the WBCSD website.

The introduction to the guidance notes:

“With the introduction of mandatory climate-related disclosures climate reporting entities will need to help users understand whether, how, and to what extent, climate-related matters are reflected in an entity's financial statements. Financial statements and climate-related disclosures supplement and complement each other and together should present a coherent picture”

The publication analyses the coherence between financial statements and climate-related disclosures in three broad chapters:

1. Impact of climate-related matters in financial statements
2. Coherence between financial statements and climate-related disclosures
3. Differences between financial statements and climate-related disclosures

It also offers an appendix on the coherence principle.

Access the XRB guide here