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IOSCO supports the establishment of a Sustainability Standards Board (SSB) under the IFRS Foundation subject to Trustees’ consideration of how the ‘requirements for success’ set out in the consultation paper are met.
Securities regulators and other capital market authorities are responsible for the oversight of capital markets and often have responsibilities for disclosure regulations. Against this backdrop, IOSCO is in a unique position to assist the IFRS Foundation in shaping its future role in corporate reporting on sustainability. IOSCO has a long history of collaboration with the IFRS Foundation and has long supported the IFRS Foundation in order to meet our shared objectives of promoting and facilitating transparency within the capital markets. In 2000, IOSCO issued a Resolution that set the foundation for the adoption of IFRS across member jurisdictions. Today, 144 jurisdictions use IFRS. And, in 2009, IOSCO worked with the IFRS Trustees to establish a Monitoring Board of public authorities. IOSCO chairs the Monitoring Board through Jean-Paul Servais as the Vice-chair of the IOSCO Board; the Monitoring Board oversees the IFRS Trustees to ensure that they discharge their duties in accordance with the IFRS Constitution.
IOSCO believes that robust sustainability reporting standards, interconnected with financial reporting standards, would also support audit and assurance – enhancing the market’s trust in sustainability disclosures, and laying the foundations for mandatory corporate reporting on sustainability internationally.
IOSCO sees an urgent need to improve the completeness, consistency and comparability of sustainability reporting. Together, the IFRS Foundation’s consultation and a parallel collaborative initiative of an alliance of sustainability reporting organizations can further efforts to facilitate comparable high-quality international standards that provide the content that capital markets need, within a transparent standard-setting architecture with a robust and inclusive governance structure.
IOSCO is committed to helping progress these initiatives with a view to establish a global comprehensive corporate reporting system.
Ashley Alder, IOSCO Chair and Chief Executive Officer of the Securities and Futures Commission (SFC) of Hong Kong, said: “Establishing a global system architecture for sustainability reporting under the IFRS Foundation could help to promote the consistency and comparability across borders that capital markets need and reduce the risk of fragmentation.
”Erik Thedéen, Chair of the IOSCO Sustainable Finance Task Force and Director General of Finansinspektionen of Sweden, said: “The creation of an SSB could help to meet our objective of promoting and facilitating transparency within the capital markets. We remain committed to continuing to work with the IFRS Foundation as it considers how best to proceed post-consultation with the view to establish a global comprehensive corporate reporting system that meets the needs to capital markets and serves the public interest.”