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TAC Public Meeting November 2024 Paper 8: November General Reporting Update
Executive summary
| Date | 05 November 2024 |
| Paper reference | TAC-Update-November |
| Project | Monitoring |
| Topic | November General Reporting Update |
Objective of the paper
This paper provides key updates since the update paper provided at the October TAC meeting.
This includes a summary of the ISSB meetings and developments, in addition to jurisdictional developments in relation to the adoption of IFRS Sustainability Disclosure Standards to date.
The information in this paper is provided as at 21 October 2024 and does not include any developments after this date.
Decisions for the TAC
There are no decisions required. This paper is for information only.
Appendices
Appendix 1 - Jurisdictional developments
This paper has been prepared by the Secretariat for the UK Sustainability Disclosure Technical Advisory Committee (TAC) to discuss in a public meeting. It does not represent the views of the TAC or any individual TAC member.
Context
1The objective of this paper is to inform the TAC of international and jurisdictional developments in sustainability-related reporting. It is for information purposes only and does not ask the TAC to make any decisions.
2The TAC will be provided with an update of UK-specific, international and jurisdictional developments on sustainability-related reporting at each of its meetings.
UK developments
3On 19 September, the UK Government published information on its framework to create UK Sustainability Reporting Standards (UK SRS) by assessing and endorsing the global corporate reporting baseline of IFRS Sustainability Disclosure Standards (IFRS SDS). While this information was not new and had already been previously communicated, it reiterated the timeline for endorsement of the standards, expected in Quarter 1 of 2025. Furthermore, it confirmed that the Financial Conduct Authority (FCA) would introduce the requirements for UK listed companies following the completion of the assessment process and endorsement decision.
4On 14 October, BDO LLP published the results of its sample survey on how mid-sized asset managers with assets under management (AUM) of between £5 billion and £50 billion were reporting against the Taskforce on Climate-related Financial Disclosures (TCFD) reporting recommendations as required by the FCA rules. The results show that 29% of the 24 mid-sized asset managers sampled were failing to fully comply with all TCFD recommendations. The most common recommendation not complied with was the quantitative climate-related stress testing and scenario analysis. By comparison, the previous research by BDO on 18 of the largest asset managers with more than £50 billion AUM concluded that all 18 firms demonstrated compliance with all 11 TCFD recommendations.
5On 15 October, the FRC published a report of its findings from sustainability assurance market study. The report details the data gathered on market trends relating to the provisions of sustainability assurance to FTSE 350 companies. Additionally, it presents stakeholder views about sustainability assurance. The FRC expects to conclude the market study and produce a final report with any proposals for action by early 2025.
International Sustainability Standards Board
6The following paragraphs provide a summary of updates from the International Sustainability Standards Board (ISSB) since 25 September 2024.
September 2024
7On 25 September the IFRS Foundation published its Voluntary Application Guide for entities to voluntarily apply the ISSB standards in jurisdictions where they are not already required to do so. The guide is intended to help entities communicate their progress to investors. Along with the interoperability guidance for the EU sustainability requirements and the interoperability guidance for the Global Reporting Initiative (GRI) standards released earlier this year, the guide is the latest in a series of publications by the ISSB to support the implementation of the IFRS Sustainability Disclosure Standards.
8The Sustainability Standards Advisory Forum (SSAF) met on 21-22 October their meeting agenda covered the following matters:
- supporting the implementation of IFRS S1 and IFRS S2,
- ISSB research projects,
- embedding interoperability into the ISSB’s ongoing work, and
- enhancing the SASB standards.
9Following the SSAF meeting of 21-22 October, the ISSB met on 24 October and discussed the following matters:
- biodiversity, ecosystems and ecosystem services and Human capital; and
- supporting the implementation of IFRS S1 and IFRS S2.
Jurisdictional developments
10The following paragraphs provide a summary of updates (since 25 September 2024) from other jurisdictions in relation to sustainability-related reporting.
11Appendix 1 contains the summary tables of the different jurisdictional decisions relating to the IFRS Sustainability Disclosure Standards. The tables have been updated since the last TAC meeting to reflect the most recent developments.
Australia
12On 8 October, the Australian Accounting Standards Board (AASB) released its new Australian Sustainability Reporting Standards (ASRS): AASB S1 General Requirements for Disclosure of Sustainability-related Financial Information and AASB S2 Climate-related Disclosures. In September 2024, the Australian Parliament passed legislation followed by Royal Assent, to mandate climate-related reporting in line with these ASRSs for certain entities beginning in January 2025. The requirements will have a limited scope, applying only to climate-related risks and opportunities with AASB S1 being a voluntary standard (aligned with IFRS S1) and AASB S2 a mandatory standard (aligned with IFRS S2 with some differences).
Meanwhile, the Australian Auditing and Assurance Standards Board (AUASB) continues to seek feedback on a proposed timeline for requiring assurance over sustainability reports. Feedback is due by 16 November 2024.
Canada
13On 9 October 2024, Canada’s Finance Ministry announced plans to mandate climate-related disclosures for large, federally incorporated private companies. The substance of these disclosures and further details on the entities in scope of the requirements are forthcoming. Earlier this year, the Canadian Securities Administrators announced they would evaluate the potential adoption of Canadian Sustainability Disclosure Standards (CSDS) set by the Canadian Sustainability Standards Board (CSSB) for publicly listed companies in Canada. The two CSDSs (CSDS 1 and CSDS 2), that align with the global baseline standards developed by the ISSB but with modifications to serve the Canadian public interest, are expected to be finalised by the end of 2024.
Malaysia
14On 24 September 2024, Malaysia launched its National Sustainability Reporting Framework (NSRF), which creates a sustainability reporting mandate in Malaysia that aligns with IFRS Sustainability Disclosure Standards. The new framework will apply from 2025, with reasonable assurance on Scope 1 and Scope 2 greenhouse gas emissions required by 2027. The stock exchange Bursa Malaysia also released a public consultation paper on proposed amendments to the listing requirements for both Main Market and ACE Market (listing categories on the exchange) to support the implementation of the NSRF. The consultation period will close on 24 October 2024.
Mexico
15In early September 2024, the Mexican Banking and Securities Commission (CNBV) announced a consultation to consider mandatory disclosures of sustainability information aligned with IFRS Sustainability Disclosure Standards. The proposed regulations would apply to all securities issuers supervised by the CNBV and would require assurance. The proposed rules would require reporting in 2026, based on 2025 data. Stakeholders are invited to submit feedback by 30 November 2024.
New Zealand
16On 7 October 2024, the New Zealand External Reporting Board (XRB) proposed amendments to the country’s climate reporting and assurance standards. These amendments would delay, by one accounting period, the mandatory disclosure and assurance of Scope 3 greenhouse gas emissions, anticipated financial impacts, and transition planning disclosures, allowing entities more time to establish reliable systems for accurate reporting. The XRB is accepting feedback on these proposed changes until 30 October. The final amendments are expected to take effect in early 2025.
Pakistan
17On 3 October 2024, Pakistan issued a consultation on phasing in ISSB-aligned standards for both listed and unlisted companies. For the largest companies, the first phase is proposed to go into effect for annual reporting periods beginning on or after 1 January 2025. The consultation period closed on 18 October 2024.
Singapore
18On 25 September 2024, the Singapore Exchange Regulation (SGX RegCo) announced updates to its sustainability reporting requirements for listed issuers. The rules will incorporate ISSB-aligned standards and, beginning January 2025, all listed issuers must disclose climate risks and Scope 1 and Scope 2 emissions. SGX RegCo stated it will conduct further reviews on issuers’ readiness before announcing a timeline for Scope 3 reporting.
EU
19On 30 September 2024, the Committee of European Auditing Oversight Bodies (CEAOB) issued its final guidelines for limited assurance over sustainability information. The CEAOB guidelines were developed at the request of the European Commission as a temporary, non-binding framework to provide clarity for preparers while the Commission works to adopt its own sustainability assurance standard.
United States
20On 27 September 2024, California Governor Newsom signed into law Senate Bill (SB) 219, Greenhouse gases: climate corporate accountability: climate-related financial risk. Bill SB-219 amends two of California’s climate disclosure laws, bills SB-253 and SB-261 which require certain public and private U.S. companies that perform certain business activities in California to disclose their greenhouse gas (GHG) emissions and climate-related financial risks, respectively.
In addition, the bill extends the deadline for the California Air Resources Board (CARB) to develop and adopt regulations implementing SB-253 by 6 months, from 1 January 2025 to 1 July 2025. It also allows the CARB to establish the due date for the reporting of scope 3 GHG emissions. SB-253 previously required scope 3 to be reported 180 days after the due date for scope 1 and scope 2 emissions, although that timing is not specified in the law. Companies are still required to initially report their scope 3 emissions in 2027. Thus, SB-219 does not delay the reporting deadlines under SB-253 or SB-261.
Appendix 1 – Jurisdictional developments
G20 jurisdictions committed to adopting IFRS Sustainability Disclosure Standards
Table 1 summarises the status of G20 jurisdictions publicly committed to adoption or other use of the IFRS Sustainability Disclosure Standards.
Table 1: G20 jurisdictions (countries and regional bodies) summary as at 21 October 2024.
| Jurisdiction | Current status | Both IFRS S1 & IFRS S2? | Reporting commencing from | Companies in scope |
|---|---|---|---|---|
| African Union: Kenya | Consultation open | IFRS S2 only | 2025-2027 | Banks |
| African Union: Morocco | Publicly committed | - | - | - |
| African Union: Nigeria | Consultation closed | Both | 2028-2030 | Listed & unlisted |
| African Union: Uganda | Consultation closed | Both | 2026-2028 | Listed |
| African Union: Zimbabwe | Publicly committed | - | - | - |
| Australia | Consultations closed | Both: | 2025 | Listed & unlisted |
| Legislation passed and subsequently signed into law | IFRS S1-voluntary | |||
| IFRS S2 - mandatory | ||||
| Brazil | Consultation closed | Both | 2026 | Listed |
| Canada | Consultation closed | Both | 2025 | To be confirmed |
| China | Consultation closed | Both | 2026-2030 | Listed & unlisted |
| India | Consultation closed | IFRS S2 only | 2025-2029 | Banking & finance |
| Japan | Consultation closed | Both | - | Listed |
| Mexico | Consultation open | Both | 2026 | Listed |
| South Korea | Consultation closed | Both | 2026-2030 | Listed |
| Turkey | Endorsed | Both | 2024 | Regulated banks & large |
Other jurisdictions committed to adopting IFRS Sustainability Disclosure Standards
Table 2 summarises the status of non-G20 jurisdictions publicly committed to adoption or other use of the IFRS Sustainability Disclosure Standards.
Table 2: Other jurisdictions summary as at 21 October 2024.
| Jurisdiction | Current status | IFRS S1 & IFRS S2? | Reporting commencing from | Companies in scope |
|---|---|---|---|---|
| Bangladesh | Endorsed | Both | 2024-2027 | Banking & finance |
| Chile | Consultation closed | Both | - | Listed |
| Costa Rica | Endorsed | Both | 2025-2026 | Listed & unlisted |
| Hong Kong | Consultation open | Both | 2025 | Listed |
| Malaysia | Consultation open | Both | 2025-2027 | Listed & unlisted |
| Panama | Publicly committed | - | - | - |
| Pakistan | Consultation closed | Both | 2025-2027 | Listed & unlisted |
| Philippines | Consultation closed | Both | 2025 | Listed |
| Singapore | Consultation closed | IFRS S2 only | 2025-2027 | Listed |
| Sri Lanka | Endorsed | Both | 2025 | To be confirmed |
| Switzerland | Consultation closed | Both | - | - |
| Taiwan | Publicly committed | - | - | - |
G20 jurisdictions not publicly committed to adopting IFRS Sustainability Disclosure Standards
Table 3 summarises the status of G20 jurisdictions not publicly committed to adoption or other use of the IFRS Sustainability Disclosure Standards.
Table 3: G20 jurisdictions (countries and regional bodies) not publicly committed to adopting ISSB as at 21 October 2024.
| Jurisdiction | Current status | Topics | Reporting commencing from | Companies in scope |
|---|---|---|---|---|
| Argentina | Unconfirmed | - | - | - |
| European Union (EU) | European Sustainability Reporting Standards (ESRS) & Corporate Sustainability Reporting Directive (CSRD) | Ten topical standards including a general and climate change standard | 2024-2028 | Listed & unlisted |
| Indonesia | Unconfirmed | - | - | - |
| Russia | Unconfirmed | - | - | - |
| Saudi Arabia | Unconfirmed | - | - | - |
| South Africa | Unconfirmed | - | - | - |
| United States of America (USA) | Climate disclosure rules by the US Securities and Exchange Commission (SEC) | Climate | SEC: 2025-2033 (currently on hold) | Listed |
| Californian climate-related disclosure regulations adopted (SB 253 and SB 261) | California: 2026 | Listed & unlisted |