The IFRS Foundation, in conjunction with the EFRAG, has released comprehensive guidance aimed at facilitating the adoption of sustainability reporting standards.
This initiative addresses the growing demand for harmonisation in sustainability reporting practices worldwide.
The IFRS Foundation, established to develop a single set of high-quality, globally accepted accounting standards, collaborates with EFRAG, a leading authority in financial reporting within the European Union.
The newly published guidance elucidates the convergence between the International Sustainability Standards Board’s (ISSB) IFRS Sustainability Disclosure Standards and the European Sustainability Reporting Standards (ESRS). It provides actionable insights on how companies can effectively adhere to both frameworks, particularly focusing on climate-related disclosures.
The guidance aims to mitigate complexity, fragmentation, and duplication for companies striving to comply with both ISSB and ESRS standards, thus promoting transparency and comparability in sustainability reporting practices globally.
Commissioner for Financial Services, Financial Stability and Capital Markets Union, Mairead McGuinness, commended the guidance, acknowledging its significance in promoting interoperability between EU and international sustainability reporting standards. Furthermore, Patrick de Cambourg, Chair of EFRAG Sustainability Reporting Board, and other key stakeholders expressed their commitment to advancing international convergence in sustainability reporting, underscoring the importance of reducing reporting burdens and supporting preparers in implementation challenges.
McGuinness said, “Climate change is a global challenge. I welcome today’s guidance that recognises the Commission’s sensible approach to sustainability reporting, and a commitment to ensuring a very high degree of alignment between EU and international sustainability reporting standards. It is important that reporting frameworks in different jurisdictions are interoperable with each other to reduce the reporting burden for EU companies.”
Patrick de Cambourg, Chair, EFRAG Sustainability Reporting Board, said, “On the basis of our joint efforts, we are very happy to be able to issue this very practical guidance on interoperability illustrating in particular how ESRS embed the global baseline approach developed by the ISSB. It demonstrates EFRAG’s commitment to the much needed international convergence of sustainability-related disclosures, on climate and other critical sustainability matters, and our full support to the global momentum in this crucial space.”
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