Emmanuel Faber, the chair of the International Sustainability Standards Board (ISSB), has said he is hopeful that the International Organisation of Securities Commissions (IOSCO) will endorse the board’s first two draft sustainability standards.
He said: “If I trust what I heard the chair of IOSCO saying in a panel about the timing through which they are looking at the endorsement of our standards, [they are aiming for] a […] seamless process with us in preparation for that.”
His comments came in opening remarks ahead of the start of the ISSB’s November meeting round in Frankfurt on Tuesday.
Meanwhile, the European Union’s advisor on accountancy matters, EFRAG, is currently developing a rival set of sustainability reporting standards that go further than the ISSB’s model by requiring impact reporting or so-called double materiality.
Faber said the ISSB was “making good progress in our search for interoperability with the EU as we speak.”
The developments in Europe are in parallel to separate moves by the US Securities and Exchange Commission to develop standards to address a more limited range of ESG issues.
Both Korea and Japan are currently paving the way to implement sustainability reporting requirements.
Nonetheless, these developments pose a potential challenge to its hopes of establishing a global baseline in sustainability reporting.
Faber said: “[O]bviously what we exist for is to ensure that there is a global baseline from which jurisdictions can build on and not [be] catching up on work that has already been done by [other] jurisdictions.”
He added that while jurisdictions should be commended for the progress they had made, the board was aware how hard it was “to make sure that the global baseline is maintained or exists in those circumstances.”
The ISSB is currently redeliberating its first two draft sustainability standards dealing with general disclosure requirements and climate reporting.
In September, it emerged in a staff paper that the board would now issue the finalised standards “as early as possible in 2023.”
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