In two separate consultations, the IFRS Foundation Trustees consulted on the demand for global sustainability standards and what role the Foundation might play in the development of such standards (September 2020) and on proposed amendments to the IFRS Foundation Constitution that would enable the creation of a new sustainability standards board under the governance of the Foundation (April 2021).
Responses to the consultations showed strong support for the IFRS Foundation's initiative and the Trustees have today published a revised constitution and corresponding feedback statement and have announced the creation of the new ISSB.
| International Sustainability Standards Board (ISSB) |
| Governance and structure |
The ISSB will sit alongside the IASB and will be overseen by the Trustees. The ISSB’s work will follow the IFRS Foundation’s established due process. Technical advice to the ISSB will be provided by a new Sustainability Consultative Committee; strategic advice will be provided by the IFRS Advisory Council, whose remit and expertise will be extended accordingly; and engagement with jurisdictional and regional initiatives will be provided through a working group already set up by the Trustees. |
| Mission |
The ISSB will develop global standards and disclosure requirements to facilitate consistent and comparable reporting by companies across jurisdictions to help to direct capital to long-term, resilient business in the transition to a low-carbon economy. |
| Name of the standards |
The name of the standards to be developed by the ISSB will be "IFRS Sustainability Disclosure Standards". |
| Composition of the ISSB |
The ISSB will normally comprise 14 members, some of which can be part-time members. The main qualifications for membership of the ISSB are professional competence and relevant professional experience. The board will comprise three members from the Asia-Oceania region, three members from Europe, three members from the Americas, one member from Africa, and four members appointed from any area. The search for members will commence shortly. |
| Chair and Vice Chair(s) |
The ISSB will have one Chair and at least one Vice Chair. They are still to be announced. |
| Seat |
The main seat of the ISSB will be in Frankfurt, but all regions - the Americas, Asia-Oceania and Europe/Middle East/Africa - will be covered by regional hubs. |
The press release also notes that leading investor-focused sustainability disclosure organizations have committed to consolidate into the new board. The Trustees expect to complete the consolidation of the Climate Disclosure Standards Board (CDSB) and the Value Reporting Foundation (VRF) into the ISSB by June 2022.
In addition to announcing the creation of the ISSB, the Trustees are also providing an update on the work of the Technical Readiness Working Group (TRWG). The TRWG was created in March 2021 to facilitate a running start of the ISSB. It was designed to integrate and build on the work of relevant initiatives focused on meeting investors’ information needs, with the purpose of providing technical recommendations for consideration by the ISSB. The following two documents that resulted from the TRWG's work were published today:
The two prototypes are accompanied by an overview of the work programme of the TRWG, explaining the technical preparatory work done so far and still to be completed so that a final set of recommendations can be handed over to the ISSB once it begins its work.
Review the following additional information on the IFRS Foundation's website:
The International Organization of Securities Commissions (IOSCO) and the Board of the International Federation of Accountants (IFAC) have issued statements welcoming the creation of the ISSB and and pledging ongoing support for the ISSB:
Note: On November 3, 2021 14:30 GMT, the ISSB was introduced in a live webcast from COP26. A recording of the event is available on YouTube.