The creation of an international standards-setter for sustainability disclosures is gaining momentum, according to the International Organization of Securities Commissions (IOSCO).
Following roundtable discussions with global policymakers and industry (including asset managers and financial firms), the umbrella group of global securities regulators said there was strong support for its vision for an International Sustainability Standards Board (ISSB). The board would set standards for consistent, comparable reporting and be created under global accounting standard-setter the IFRS Foundation.
The globally aligned reporting standards would start with climate-related financial disclosure and expand to a wider range of sustainability issues.
“Many participants stressed that voluntary disclosure would not be enough and hence supported clear pathways towards mandatory reporting requirements aligned across jurisdictions, along with robust frameworks for audit and assurance,” it noted.
IOSCO is making significant progress in helping to establish the ISSB before the U.N. climate conference in November, said Erik Thedéen, chair of the IOSCO Sustainable Finance Task Force and director general of Sweden’s financial regulator, Finansinspektionen.
“This will drive much-needed international consistency,” Thedéen said in a release. “We will continue to engage with key jurisdictions and other stakeholders across the official and private sectors to promote appropriate implementation of the proposed building blocks approach.”
IOSCO is expected to deliver a report on sustainability disclosure standards for issuers next month, with a report on disclosure by asset managers due by the end of the year.