At last week’s IFRS Foundation Sustainability Symposium in New York, the chair of the International Sustainability Standards Board (ISSB) reflected on the rapid progress in creating a global baseline for sustainability reporting since the formation of the ISSB in November 2022.
“Ending the alphabet soup — this is what led to the creation of the ISSB, which was tasked with this mission impossible,” ISSB Chair Emmanuel Faber said. “We today are able to say that mission impossible may be possible. It may be possible, but it won’t be possible if we do not work, all of us together.”
To that end, AICPA & CIMA, together as the Association of International Certified Professional Accountants, during the symposium announced newly established membership into the IFRS Foundation’s Partnership Framework and a new contributor role with the standard-setting organisation’s Knowledge Hub.
The initiatives are designed to raise global awareness about the IFRS sustainability disclosure standards and support their implementation.
AICPA & CIMA served as the event’s premium sponsors.
“We’re pleased to work with the IFRS Foundation in highlighting the need for consistent, comparable, and high-quality sustainability information for capital markets,” said Jeremy Osborn, FCMA, CGMA, Ph.D., AICPA & CIMA’s global head of sustainability.
With the ISSB’s first two sustainability-related standards now effective, the symposium focused on the commitment made by the IFRS Foundation (which oversees the ISSB) and its partners to help jurisdictions adopt the standards. Faber announced the publication of the precursor to a jurisdictional guide to assist with adoption of the standards.
“The ISSB aims to consolidate the global sustainability disclosure landscape,” ISSB member Elizabeth Seeger said. “This is to reduce the complexity that results from having multiple sources of reporting guidance while also building on the established expertise and practices associated with market-leading frameworks and standards. In other words, this is not about reinventing the wheel.”
The wheels are in motion.
Jay Eisenhardt, senior sustainable investing product manager for Northern Trust Asset Management, pointed out that the 14 countries currently pursuing adoption of IFRS S1 and S2 comprise 18% of the global securities market, as measured by the MSCI All Country World Index.
“And, if we take the US out of that calculation, those 14 countries jump to about 50% of the global market cap,” Eisenhardt said during the symposium. “Think about that for a second: Roughly half the global market cap, excluding the US, is in the process of adopting S1 and S2 to some degree.
“From my standpoint, just this pure stand-alone metric should be enough to show companies how important S1 and S2 are for the markets. Change is coming.”
— To comment on this article or to suggest an idea for another article, contact Bryan Strickland at Bryan.Strickland@aicpa-cima.com.
