IFRS S1 and S2 reporting standards are essential tools for organizations committed to sustainability. By adopting these standards, organizations can enhance their transparency, improve decision-making, and demonstrate their commitment to responsible business practices. IFRS S1 and S2 are the inaugural sustainability disclosure standards issued by the International Sustainability Standards Board (ISSB). These standards aim to provide a global baseline for sustainability-related financial disclosures, helping organizations communicate their sustainability-related risks and opportunities to investors and other stakeholders.
IFRS S1: General Requirements for Disclosure of Sustainability-related Financial Information IFRS S1 sets out the general requirements for disclosing sustainability- related financial information. It requires organizations to disclose information about sustainability-related risks and opportunities that could reasonably be expected to affect their prospects, including cash flows, access to finance, and cost of capital. The standard emphasizes transparency and consistency in reporting, ensuring that the disclosed information is useful for decision-making.
IFRS S2: Climate-related Disclosures IFRS S2 builds on IFRS S1 by providing specific requirements for climate-related disclosures. It requires organizations to disclose information about their climate-related risks and opportunities, integrating the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). This standard ensures that organizations provide comprehensive and comparable information about their climate impact, helping investors make informed decisions.
As member of IFRS Sustainability Alliance, Karisman Learning & Consulting will provide comprehensive capacity building for your company and develop sustainability / ESG reporting or integrated reporting in accordance with IFRS S1 & S2.
Organization should be noted that the application of IFRS S1 will require Materiality Assessment and IFRS S2 will require Climate Risk Assessment beforehand in the report.
