New ISSB Standards and What They Mean for Australian Companies?
July 10, 2023DownloadsDownload Article
In June 2023, the International Sustainability Standards Board ("ISSB") released its inaugural sustainability standards, IFRS S1 and IFRS S2,1 establishing a global common language for sustainability disclosure.
IFRS S1 and IFRS S2, collectively referred to as the "Standards", will drive a significant increase in ESG reporting by Australian companies. The Standards require mandatory ESG reporting requirements for Australia's largest listed and unlisted companies (more than 500 employees, AUD$500 million+ in revenues and more than AUD$1 billion+ in assets) and financial institutions with annual reporting periods beginning on or after 1 January 2024.2 It is vital for organisations to fully understand the new requirements and modify existing approaches to ESG reporting and their strategy to be compliant.
With local jurisdiction-specific aspects still to be determined through public consultation on Australia’s climate-related financial disclosure, there are opportunities for Australian companies and financial institutions to contribute to decision-making around key determinants. These include implementation timeline, reporting entity size and greenhouse gas emissions accounting.
The following is a quick overview of the new Standards, answering the following questions. What do the Standards include? How is materiality approached? Is there a connection to financial reporting? What are the implications for Australian companies?