We welcome the Board’s project to revise the Practice Statement on Management Commentary. However, we believe that further improvements are necessary on the following issues:

• The Practice Statement would benefit from clearer concepts to help preparers and users understand its underlying thinking and to set a context for the type and range of disclosures envisaged.
• We do not think that it is sufficient to measure financial outcomes alone as appears to be proposed in the Exposure Draft.
• We suggest restructuring the Practice Statement to make it easier to navigate and apply, for example, by reducing the number of elements. In our view, these elements overlap in many aspects and their interaction and purpose is not always immediately understandable. We suggest a closer alignment to the <IR> Framework, whose structure includes fundamental concepts, guiding principles for the preparation and presentation of an integrated report, content elements that are fundamentally linked to each other, and high-level and specific objectives for each content element.
• We suggest that the approach to materiality set out in the Practice Statement should articulate more clearly that it necessitates the application of a filter to identify a subset of impacts that are relevant to enterprise value and are therefore material to the information needs of users of management commentary.

In addition, since this project commenced, the IFRSF has made a significant move towards establishing global sustainability standards. We think the Board should therefore consider the future direction of the project in the light of this development.

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