Recent developments in sustainability reporting, or: how high the moon!

I’m sure I’m not the only one who can hardly keep up with all the developments on the sustainability reporting front…

For instance, the ISSB recently announced a “Partnership Framework for capacity building in developing and emerging economies” designed to “(seek) alignment on a shared vision that widespread availability of high quality, comparable and timely information is foundational to understanding the financial risks, opportunities, and impacts associated with climate and wider sustainability topics and achieving the 2030 Agenda (this being a resolution that adopted the UN Sustainable Development Goals).”

It also announced around the same time that “CDP, the not-for-profit which runs the global environmental disclosure platform for corporations, …will incorporate the International Sustainability Standard Board’s (ISSB) IFRS S2 Climate-related Disclosures Standard [IFRS S2] into its global environmental disclosure platform, in a major step towards delivering a comprehensive global baseline for capital markets through the adoption of ISSB standards. The Standard, currently being finalized, will be incorporated into CDP’s existing questionnaires, which are issued to companies annually on behalf of 680 financial institutions with over $130 trillion in assets.”

And that was just a few days after announcing the membership of “a new advisory group, the Integrated Reporting and Connectivity Council, “an advisory body to the IFRS Foundation Trustees, the IASB and the ISSB providing guidance on how reporting required by the IASB and the ISSB could be integrated, and how the IASB and the ISSB could consider applying principles and concepts from the Integrated Reporting Framework to their projects.” The membership of that “advisory group” included over a hundred names, maybe in an attempt not to leave a single potential adversary completely outside the tent.

But then, on the very same day, you could read this story:

  • Promises by companies, banks and cities to achieve net-zero emissions often amount to little more than greenwashing, U.N. experts said in a report on Tuesday as they set out proposed new standards to harden net-zero claims.
  • The report, released at the COP27 climate conference in Egypt, is intended to draw a “red line” around false claims of progress in the fight against global warming that can confuse consumers, investors and policy makers.
  • At  last year’s climate negotiations in Glasgow, U.N. Secretary-General Antonio Guterres appointed 17 experts to review the integrity of non-state net-zero commitments amid concerns about “a surplus of confusion and deficit of credibility” around corporate climate claims.
  • “Too many of these net-zero pledges are little more than empty slogans and hype”, group chair and Canada’s former environment minister, Catherine McKenna, said during a news conference launching the report.
  • “Bogus net-zero claims drive up the cost that ultimately everyone will pay,” she said.

And also on the same day, the US election, while perhaps not delivering the country into the wretchedly irrational and regressive hands of the Republicans as tightly as expected, gave them the House of Representatives, basically ending any chance of major progressive regulation for the next two years, and increased the personal standing of the scary Rob DeSantis, whose hostility toward environmental activism runs only a step or two at best behind his hatred for everything else “woke.” The ISSB of course didn’t make any mention of that. But two days later, it did announce this:

  • The Financial Reporting Council of Nigeria has announced at COP27 that they will move to adopt the International Sustainability Standards Board’s (ISSB) IFRS Sustainability Disclosure Standards in Nigeria when they are issued in 2023.
  • Commenting, Emmanuel Faber, Chair of the ISSB, said:
    • Earlier this year, African Finance Ministers announced their support for the work of the ISSB, citing that early adoption by African jurisdictions and companies has the potential to attract more investment and to boost private sector development in Africa. I am delighted that the Financial Reporting Council of Nigeria has formalized this support through its decision to adopt the IFRS Sustainability Disclosure Standards, which will be facilitated via IOSCO ahead of its review of the ISSB’s finalized standards for potential IOSCO endorsement. The announcement by Nigeria is yet a further signal of the momentum behind the ISSB’s objective to deliver a common language for sustainability-related disclosures worldwide.

Good news of course, and no disrespect, but is anything that happens in Niagara really a major signal of anything that’s likely to occur worldwide (especially, as I say, when compared to much larger and more depressing signals coming from elsewhere)? Well, of course there’s some subjectivity involved in assigning relative value to competing news events. For now the ISSB generates so many of them that one could assess the battle of positive and negative news to be basically a draw, in line with a recent comment in a New York Times opinion piece that “you can tell different stories about the present state of climate action depending on your perspective, inclination, point of ideological emphasis or even mood.” I’m not sure what my present mood is in this regard, but it’s probably something less than delighted…

The opinions expressed are solely those of the author

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