Date posted: 14/10/2020

Who should be responsible for global sustainability reporting standards?

IFRS Foundation Trustees consult on global approach to sustainability reporting and on possible role for the Foundation

In brief

  • The Trustees of the IFRS Foundation have published a Consultation Paper to assess demand for global sustainability standards.
  • If demand is strong, to determine whether the Foundation might contribute to the development of such standards.
  • CA ANZ will contribute to the consultation process and seeks member input in preparing the submission.

The Trustees of the IFRS Foundation have published a Consultation Paper to assess demand for global sustainability standards and, if demand is strong, to assess whether and to what extent the Foundation might contribute to the development of such standards.

The IFRS Foundation was established to develop a single set of globally accepted accounting standards. It is the organisation behind IFRS Standards—financial reporting standards required for use by more than 140 jurisdictions, including Australia and New Zealand. The Trustees are responsible for the strategic direction and governance of the Foundation as well as for oversight of the International Accounting Standards Board, which sets IFRS Standards.

Amid heightened focus on environmental, social and governance (ESG) matters, developments in sustainability reporting and increased calls for standardisation of such reporting, the Trustees are now seeking stakeholder input on the need for global sustainability standards and gauging support for the Foundation to play a role in the development of such standards.

The Consultation Paper sets out possible ways the Foundation might contribute to the development of global sustainability standards by broadening its current remit beyond the development of financial reporting standards and using its experience in international standard-setting, its well-established and supported standard-setting processes and its governance structure.

One possible option outlined in the paper is for the Foundation to establish a new Sustainability Standards Board. The new board could operate alongside the International Accounting Standards Board under the same three-tier governance structure, build on existing developments and collaborate with other bodies and initiatives in sustainability, focusing initially on climate-related matters.

The consultation closes on 31 December 2020. CA ANZ will be contributing to this process and seeks member input in preparing the submission.

Announcement by IFRS Foundation

IFRS Foundation Trustees consult on global approach to sustainability reporting and on possible Foundation role.

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