Progress Toward a Global Corporate Reporting System Continues With Launch of IFRS S1 and S2

GRI welcomes the launch of the International Sustainability Standards Board (ISSB)'s inaugural set of International Financial Reporting Standards (IFRS) S1 General and S2 Climate-Related Disclosures. This step represents a significant landmark in the pursuit of a global cohesive corporate reporting that consists of a two-pillar reporting system with two distinct perspectives and purposes.

One pillar is comprised of Impact reporting. This pillar speaks to how the organization impacts the world – an inside-out perspective. The GRI Standards provide the global common language for reporting on this perspective, aiding organizations to be transparent and accountable for their societal and environmental impacts in a comparable and standardized way. The resulting disclosures enable the organization, and their internal and external stakeholders, to make informed decisions in their interest and help them contribute to sustainable development.

The other pillar, with an outside-in perspective, focuses on strengthening financial reporting through the incorporation of the financial implications of sustainability issues on the business. This aspect emphasizes risks and opportunities for a company’s business model and value drivers. The ISSB’s work contributes to fulfilling the information needs of investors by enabling companies to provide comprehensive sustainability information to capital markets.

Eelco van der Enden, CEO of GRI, said:

“I congratulate the ISSB on reaching this significant milestone. I believe the new IFRS Sustainability Disclosure Standards will have an important role in ensuring that the risks and opportunities related to sustainability issues are firmly anchored in the decision-making of investors.

Our respective standards have distinct yet complementary purposes; with GRI ensuring transparency on an organizations’ impacts on people and planet, while the ISSB is focused on supporting efficient and resilient capital markets. Taken together, I believe our standards can provide the complete picture on sustainability impacts and performance.”

The launch of ISSB’s Standards was prominently featured at the GreenFin event last week, where Matthew Rusk, representing GRI in North America, led a panel discussion on the complementary nature of Impact Materiality and Financial Materiality (together forming Double Materiality). Throughout the conversation it became evident that organizations’ impact on the environment and society become issues of financial relevance to the business over time. The session highlighted that the understanding of the interconnectivity of the materiality perspectives, and a global system for consistent disclosures to drive better performance, is critical.

Bob Massie, Co-Founder of GRI, said: 

“At GreenFin we saw hundreds of people eager to uncover more information about financial and impact materiality -- and hundreds more who are eager to provide it. There was a near-universal desire to understand the relationship between the world's leading sustainability standards -- the GRI, ISSB, and EFRS -- and to see them converge - something than will continue to accelerate the transformation of capitalism over the next decade.”

Through the GRI-IFRS MoU signed in March 2022, the two organizations recognized the two equal and interconnected sustainability reporting perspectives and committed to coordinating work programs and standard-setting activities. With over 11,000 organizations producing reports using the GRI Standards and over 2,800 organizations using Sustainability Accounting Standards Board (SASB) Standards, the IFRS S1 and S2 continue important progress in the creation and adoption of a consistent global corporate reporting system.