The International Sustainability Standards Board (ISSB) has been established at COP26 with the purpose of developing a comprehensive global baseline of sustainability disclosures for the capital markets. The purpose of the consultation is to develop a comprehensive global baseline of sustainability disclosures designed to meet the information needs of investors in assessing enterprise value.
To this end, the consultation includes proposed standards on general sustainability-related disclosure requirements as well as on climate-related disclosure requirements |Position – Executive summary | August 2022 |
CONSISTENCY BETWEEN ISSB STANDARDS AND EFRAG ESRSs
WSBI-ESBG believe that it is crucial to achieve consistency of sustainability reporting at global level and especially a full alignment of reporting requirements between ISSB standards and EFRAG European Sustainability Reporting Standards (ESRSs) to ensure a global playing field in terms of sustainability reporting. This convergence between both standards will address the risk of additional disclosures.
DOUBLE MATERIALITY
WSBI-ESBG highlight that the IFRS sustainability standards are based on an ‘enterprise value creation’ or financial materiality approach, in which sustainability impacts are measured in terms of impacts on the financial position and prospects of the company itself. On the other hand, the EFRAG ESRSs are being developed based on the ‘double materiality’ principle, where disclosure is required both from the point of view of financial impact on the company and on the impact of the company on society and the environment.
TRANSITION PLANS
WSBI-ESBG notes that the EFRAG ESRSs make a clearer reference to alignment with limiting global warming to 1.5°C in line with the Paris Agreement. On the other hand, IFRS sustainability standards allow the entity to choose its own target. By way of consequence, WSBI – ESBG requests that the ISSB takes into consideration including a clear reference to the 1.5°C target of the Paris Agreement in order to ensure comparability between the two standards.
BOUNDARIES AND VALUE CHAIN
Although, WSBI – ESBG considers it essential that sustainability reporting should capture the entire value chain, we ask for clearer and more defined boundaries as it is considered difficult and complicated to obtain information from companies that are not under the control of a financial institution, especially regarding scope 3 GHG emissions.
RELATED CONTENT
related
February 21, 2023
ESBG responded to the ESMA consultation about the use of ESG terms in funds’ names
On 17 February, ESBG submitted its response to the ESMA consultation about the use of ESG terms in funds’ names
February 3, 2023
Advocating on the EU deforestation regulation
What lessons can be learnt from a French diplomat from the XIX century?
January 11, 2023
ESBG responds to the ESAs call for evidence on greenwashing
Therefore, in the interest of customers, banks, saving banks and issuers of financial products, ESBG
October 5, 2022
Joint letter to Commissioner McGuinness on the EFRAG consultation regarding its first set of draft ESRSs
On 27 September, the ESBG, together with the European Banking Federation (EBF), the European Association of Co-operative Banks (EACB), Insurance Europe, Accountancy Europe, Business Europe and…
September 9, 2022
ESBG response to the EFRAG consultation on its first set of draft ESRSs calls to ensure levelled global playing field
In its response to the European Financial Reporting Advisory Group (EFRAG) public consultation on the first set of Draft EU Sustainability Reporting Standards (ESRSs), the European Savings and Retail…
September 7, 2022
EU Taxonomy minimum safeguards: Criteria for the application of external checks should be further defined
The European Savings and Retail Banking Group submitted its final response to the Platform for Sustainable Finance (PSF) consultation on its draft report on minimum safeguards (MS). In its response,…
July 8, 2022
World savings and retail banks call for harmonised taxonomies on sustainable finance
The World Savings and Retail Banking Institute (WSBI) called today on policymakers for the harmonisation of taxonomies on sustainable finance. At the end of the 26th WSBI World Congress, the…
July 7, 2022
World savings and retail banks moving forward on sustainability
World Savings and Retail Banking Institute (WSBI)'s members get together for the first time since 2018 at the 26th World Congress, in Paris. Under the title 'Locally Rooted, Globally responsible' the…
May 27, 2022
ESBG calls for more feasible rules on the new corporate sustainability due diligence
In its response to the European Commission call for feedback on the proposal for a Directive on Corporate Sustainability Due Diligence, the European Savings and Retail Banking Group (ESBG) suggests…
April 28, 2022
ESBG response to ESMA’s consultation on guidelines of MiFID II suitability requirements
ESBG's response to the European Securities and Market Authority (ESMA) consultation on some MiFID II sustainability aspects. European banks calls for clear procedures and to avoid unnecessary…