The IFRS Foundation, which oversees the International Sustainability Standards Board (ISSB), will take over the monitoring of companies’ progress on climate-related disclosures from the Task Force on Climate-related Financial Disclosures (TCFD).
At a Financial Stability Board (FSB) plenary meeting in Frankfurt last week, the FSB said: “Following the delivery of the TCFD’s 2023 annual status report in September, the FSB asks the IFRS Foundation to take over the monitoring of the progress on companies’ climate-related disclosures from the TCFD as of next year.”
The news follows the recent publication of the first standards from the ISSB – IFRS S1 and IFRS S2 – which serve as a global baseline of sustainability disclosures for the capital markets and have been called a “landmark” for the financial sector by industry commentators.
See also: – ISSB: Everything you need to know
The two standards fully incorporate the recommendations of the TCFD, which has led the FSB to note that the taskforce’s work has therefore ‘culminated’.
“The TCFD has been a trailblazer in raising the practice and quality of climate-related disclosures, providing much-needed information to investors about climate-related risks and opportunities”, said ISSB chair Emmanuel Faber (pictured).
“The ISSB has built from and consolidated the market-leading investor-focused sustainability-reporting initiatives to deliver the ISSB standards, with the TCFD recommendations at the heart of this.
“As such, the ISSB welcomes the FSB’s request to transfer the TCFD’s monitoring responsibilities to the ISSB from 2024 and the opportunity to build on TCFD’s legacy. This announcement provides yet further clarification of the so-called ‘alphabet soup’ of ESG initiatives for companies and investors.”
In July, the FSB will deliver to the G20 an updated roadmap to reflect the progress made across a range of SSB and international organisations on climate-related financial risks.