There is a new wave of #Sustainability disclosure standards and regulatory requirements on the rise worldwide, as a lot has happened recently in the industry.?
Here is a quick rundown on the main industry updates, such as having the United Kingdom come up with their own sustainability standards and updates on the ESRS Double Materiality Assessment for companies in the EU.?
What you’ve missed on Sustainability Reporting recently - in bullet points!
Updates on Double Materiality Assessment for ESRS reporting
- As Double Materiality assessment takes a prominent role in the final ESRS, EFRAG published a draft of their guidance on the topic which many companies were waiting for
- Some insights from the guidance include leveraging existing processes and tools such as due diligence processes to identify potential material sustainability matters, and companies should not shy away from reporting on matters that are not explicitly addressed in the ESRS
- Companies should also prioritize stakeholders that are most directly affected by their operations, it’s recommended to add their and also investors' and lenders’ key inputs
- When assessing negative impact, companies should consider how grave it is, but also the reach of it
Click here to see all of the Double Materiality inputs from our COO,
Thilo Hitz
.
IOSCO endorses ISSB sustainability standards
- IOSCO, the renowned international policy forum for securities regulators, officially endorses the new IFRS sustainability and climate-related disclosure standards
- While fostering consistency and comparability, it overlooks the critical aspect of double materiality, focusing solely on financial materiality
- IOSCO's reach extends to 130 member jurisdictions, which regulate more than 95% of global financial markets, so it will indeed shape how we all report on sustainability
- In contrast to the European Sustainability Reporting Standards (ESRS) the endorsed IFRS ISSB standards currently account only for financial impact, therefore its view of environmental and social impact is very limited
Click here to learn more about it.
A new era of Sustainability Auditing arrives with ISSA 5000
- The International Standard on Sustainability Assurance (ISSA) 5000 is a new accounting standard proposed by the International Auditing and Assurance Standards Board (IAASB)
- The context of the proposal is that companies worldwide are currently preparing to report on sustainability and climate-related risks, opportunities, and impact, and such proposal is aligned with standards and regulations already in place, like the CSRD?
- The new standard serves as a global baseline for sustainability assurance and is designed to be adaptable for businesses of all sizes and compatible with any suitable sustainability reporting framework, including those issued by the EU, ISSB, GRI, ISO, and others
Click here to learn more about it.
UK Sustainability Disclosure Standards Are Coming
- The UK announced that their Sustainability Disclosure Standards (SDS) are coming for companies to report on sustainability and climate-related risks
- They will be based on the sustainability and climate-related reporting standards issued by the International Sustainability Standards Board (ISSB) of the IFRS Foundation and it will only diverge from the global baseline when necessary for UK-specific matters
- The Secretary of State for Business and Trade will consider endorsing the IFRS Sustainability Disclosure Standards to create UK SDS by July 2024
Click here to check out more about it.
India is setting an example for the global ESG landscape
- New rules from the Securities and Exchange Board of India (SEBI) request ESG funds to invest at least 80% of their assets in securities that align with their specific strategies, setting a precedent for other nations to follow
- As they raise the bar in sustainable finance, they require asset managers to provide monthly ESG scores for fund holdings
- As they are specific to India, it still represents a trend of increasing global interest in ESG metrics that companies worldwide should be aware of
Click here for more on India’s initiative.
We’ll keep you posted!
Daato’s holistic platform covers all the main regulations your company should be managing, tracking, and reporting - such as the CSRD/ESRS, and the LkSG in Germany.
- We conduct risk assessment and analysis on a deeper level in your supply chain to make sure you’re not caught off guard
- We offer media monitoring of potential risks across the globe for you to avoid or respond to them
- We put your data together from different teams and suppliers and guarantee that its auditable documentation and reporting are on point with the main regulations
Here you can reach out to our team for a Demo, and see the best way we can get your Sustainability Reporting done!
