CONSISTENCY BETWEEN ISSB STANDARDS AND EFRAG ESRSs
WSBI-ESBG believe that it is crucial to achieve consistency of
sustainability reporting at global level and especially a full alignment
of reporting requirements between ISSB standards and EFRAG European
Sustainability Reporting Standards (ESRSs) to ensure a global playing
field in terms of sustainability reporting. This convergence between
both standards will address the risk of additional disclosures.
DOUBLE MATERIALITY
WSBI-ESBG highlight that the IFRS sustainability standards are based on
an ‘enterprise value creation’ or financial materiality approach, in
which sustainability impacts are measured in terms of impacts on the
financial position and prospects of the company itself. On the other
hand, the EFRAG ESRSs are being developed based on the ‘double
materiality’ principle, where disclosure is required both from the point
of view of financial impact on the company and on the impact of the
company on society and the environment.
TRANSITION PLANS
WSBI-ESBG notes that the EFRAG ESRSs make a clearer reference to
alignment with limiting global warming to 1.5°C in line with the Paris
Agreement. On the other hand, IFRS sustainability standards allow the
entity to choose its own target. By way of consequence, WSBI – ESBG
requests that the ISSB takes into consideration including a clear
reference to the 1.5°C target of the Paris Agreement in order to ensure
comparability between the two standards.
BOUNDARIES AND VALUE CHAIN
Although, WSBI – ESBG considers it essential that sustainability
reporting should capture the entire value chain, we ask for clearer and
more defined boundaries as it is considered difficult and complicated to
obtain information from companies that are not under the control of a
financial institution, especially regarding scope 3 GHG emissions.