Mr Servais discussed IOSCO’s coordination role at international level before turning to the initiatives taken by the IFRS Foundation. He focused on corporate level disclosures, staing that there was a growing momentum building, as attested to by various press statements and reports in recent weeks issued by IOSCO, the IFRS Foundation, the FSB and the European body EFRAG.

Mr Servais noted that although in recent years, environment-related disclosure has improved, investor demand for sustainability-related information is still not being properly met. Therefore, IOSCO supports mandatory disclosure beyond the voluntary frameworks that are still the norm in many jurisdictions. Most recently, the IOSCO Board issued a press release referring to the urgent need to improve the consistency, comparability and reliability of sustainability reporting. The IOSCO Board identified as priorities encouraging globally consistent standards and promoting comparable metrics and narratives.

The press release also noted that IOSCO has a key role to play in working with the IFRS Foundation Trustees toward the establishment of a Sustainability Standards Board (SSB), to sit alongside the International Accounting Standards Board (IASB) under the existing IFRS Foundation governance structure, as IOSCO will have an essential role to play in evaluating the standards issued by the SSB for cross-border purposes governing issuers ́ sustainability-related reporting requirements, and in encouraging members and relevant authorities to consider these standards when setting sustainability-related disclosure requirements at national and regional levels.

Last week, the IFRS Foundation published a press release confirming that it remains on track to make a final determination about a new board in advance of the November 2021 United Nations COP26 conference. Building on a successful public consultation and following the direction set by IOSCO in its press release in February, the Trustees outlined key features of the new SSB and its work, including the intention to build on existing standards and frameworks. Mr Servais noted that IOSCO is on the same page and encourages the SSB to leverage the content of existing sustainability-related reporting frameworks, because this can give the IFRS Foundation a running start in developing a common set of international standards. IOSCO also supports the envisioned building blocks approach with the SSB's standards providing a globally consistent and comparable sustainability-reporting baseline, while also providing flexibility for coordination on reporting requirements that capture wider sustainability impacts. IOSCO is also exploring with the IFRS Foundation and other multilateral bodies the possibility of establishing a consultative committee under the IFRS Foundation that can advise the SSB on those sustainability topics that are material from an enterprise value creation perspective and advise on consistency in requirements on the broader sustainability topics.

Mr Servais concluded his discussion of the IFRS Foundation roadmap by referring to the final reports on possible EU non-financial reporting standards released last week. He noted:

I believe there is coherence between the IFRS/IOSCO approach and the EU’s thinking on international cooperation. In its recent report of 8 March to the Commission, the European Reporting Lab at EFRAG proposed that the EU promote and participate in global convergence efforts on a ‘co-construction’ basis. The ultimate goal, as expressed, is to foster coherence and consistency between EU and global sustainability reporting. It can be noted that the EU intends to pay particular attention to the decisions to be made by recognised global standard-setters in order to promote convergence. 

Mr Servais also added the comment that it would be good if in principle all regional initiatives were available to participate in global convergence efforts, so as to make convergence happen as quickly as possible.

Please click to access the full transcript of Mr Servais' keynote address on the IOSCO website.