The GHG Protocol and the IFRS Foundation have recently bolstered their cooperative efforts to streamline greenhouse gas emissions reporting by signing a MoU.
According to ESG News, this agreement sets a path for both organizations to develop robust reporting standards that align closely with the needs of capital markets globally.
At the core of this partnership is the integration of GHG Protocol standards within the broader framework of the IFRS Foundation’s Sustainability Disclosure Standards, particularly the IFRS S2 Climate-related Disclosures. These standards are vital for ensuring that companies across the world can report their emissions in a consistent and comparable manner, reducing the burden on businesses while enhancing transparency for investors.
The MoU specifically facilitates governance arrangements where the International Sustainability Standards Board (ISSB), a body under the IFRS Foundation, will have a more active role in the updates and decisions related to the GHG Protocol Corporate Standard. A representative from the ISSB will also join the GHG Protocol Independent Standards Board as an observer, further cementing the strong collaborative ties between these two influential entities.
Emmanuel Faber, Chair of the ISSB, emphasized the importance of this partnership, stating, “The GHG Protocol standards are vital tools for enabling companies around the world to measure their greenhouse gas emissions consistently and comparably. Through the enhanced partnership between the International Sustainability Standards Board and GHG Protocol we are better placed to support ongoing compatibility between our work so that the information companies provides meets the needs of capital markets around the world. The result should lead to much welcome minimised cost and effort for preparers.”
Ani Dasgupta, President and CEO of the World Resources Institute, also highlighted the practical benefits of the agreement, remarking, “For years, companies faced inconsistent greenhouse gas reporting requirements across different platforms and capital markets. This meant they struggled with conflicting paperwork when they should have been focusing on driving down emissions and reducing climate-related risks. But when ISSB decided to use the GHG Protocol’s corporate standard as the basis for measurement of GHG emissions in its climate standard (IFRS S2), it brought clarity and consistency in reporting for companies and capital markets that was sorely needed. Going forward, this formal partnership will bring GHG Protocol and ISSB even closer together, I hope that this will empower companies and the financial sector continue to make credible progress towards achieving their climate goals.”
This strengthened alliance between GHG Protocol and ISSB is poised to significantly influence the way companies globally measure and report greenhouse gas emissions, thereby facilitating more informed investment decisions and fostering a more sustainable corporate landscape.
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