FRC responds to International Sustainability Standards Board's consultation

  • FRC Image

30 Jun, 2022

The Financial Reporting Council (FRC) has published its comment letters relating to the International Sustainability Standards Board (ISSB) Exposure Drafts (EDs): S1 General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1) and S2 Climate Related Disclosures (IFRS S2).

In March 2022, the ISSB issued two EDs, IFRS S1 (ED/2022/S1) and IFRS S2 (ED/2022/S2).  The FRC strongly supports the development of high-quality global standards for sustainability reporting and welcomes the opportunity to provide comments on the ISSB's first Exposure Drafts.  The comment letters highlight some overarching comments for consideration in relation to the EDs including areas such as:

  • clarification on the use of non-mandatory guidance, structure of S1 and the architecture of IFRS Sustainability Disclosure Standards, clarity of the standard, connectivity, and basis of preparation (IFRS S1)
  • the current industry-based requirements, consistency between the assumptions used in climate-related reporting and those used elsewhere in the financial statements, connection to IFRS S1 and clarity of the standard (IFRS S2).

Whilst emphasising that there is a clear and urgent need for IFRS Sustainability Disclosure Standards, the FRC highlights that a balanced approach is needed to ensure the standards are published timely without compromising on the quality and due process required to ensure the standards are of high quality, drive high quality reporting and are globally accepted.   

A press release and the comment letters (IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures) are available on the FRC website.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.