Is ISSB plans to work with IPSASB to help government organizations disclose on sustainability?
Responses to IPSASB's proposals to develop a sustainability reporting framework for the public sector strongly encouraged consistency and collaboration with the ISSB, and the IFRS Foundation has declared willingness to collaborate with IPSASB as it moves forward with its initiative.
Is ISSB incorporating a double materiality expectation?
No. "Double materiality," which is the approach that Europe is taking, encompasses both financial materiality and impact materiality. The ISSB is focused on providing financially material information to investors in accordance with the IFRS definition: "Information is material if omitting, misstating or obscuring it could reasonably be expected to influence the decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity." With this approach, the information required by ISSB Standards is consistent with the US Supreme Court's definition of materiality. We sometimes refer to financial materiality as "investor materiality."
Can you comment on the extent to which the ISSB has offered any view regarding recommending the availability of safe harbor provisions to reporters with respect to sustainability reporting (e.g. Scope 3 or other sustainability reporting disclosures)
Safe harbors would be decided by the securities regulators in jurisdictions that adopt for the ISSB's standards, not by the ISSB. However, at its October meeting, the ISSB confirmed it will require Scope 3 GHG emissions disclosure (if material) and decided to develop relief provisions to help companies apply the Scope 3 requirements, including collaborating with security regulators to provide safe harbor provisions. The relief, to be decided at a future meeting, could also address data availability challenges by giving companies more time to provide Scope 3 disclosures.
The concept of ESG controller you mentioned - what functions are you seeing that is leading this effort? Is it Finance, Public Relations, Law or others?
I'm seeing this new function of ESG controller on finance teams, or as a bridge between the finance and sustainability teams. If you think of a traditional corporate controller, an ESG controller would supervise sustainability accounting and functions, including implementing ESG data policies and preparing annual forecasts. This function is particularly important at large companies with far-flung operations and sometimes a complicated entity structure.Neil StewartDirector of Corporate Outreach, IFRS Foundation
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