The International Organization of Securities Commissions (IOSCO) announced today the launch of a Technical Expert Group (TEG) tasked with assessing the technical recommendations to be developed as part of the International Financial Reporting Standards Foundation’s (IFRS) sustainability standards project.
IOSCO is the leading international policy forum for securities regulators and is recognised as the global standard setter for securities regulation. The organization’s membership regulates more than 95% of the world’s securities markets.
Today’s launch follows the announcement earlier this month by the IFRS foundation of the formation of a working group consisting of leading reporting standards bodies to accelerate the goal of establishing global sustainability standards under a potential Sustainability Standards Board (SSB), with IOSCO invited to join as an observer to the group.
In October 2020, the IFRS initiated a three-month consultation, seeking feedback on the potential formation of global sustainability reporting standards, and its own place in that process. The working group was launched following the announcement in February by the foundation of plans to move forward on the project.
IOSCO stated that the TEG, launched under its Sustainable Finance Task Force (STF) will work closely with the IFRS Foundation’s working group and will be tasked with reviewing and assessing its technical recommendations focused on enterprise value creation. The TEG will assess refinements to the prototype and its content, including industry-specific metrics, considering whether the it could be a sound basis for the development of an international reporting standard under the SSB.
With a focus on enterprise value, the TEG will consider whether the standards meet the capital market’s core information needs and serve as a baseline for consistent and comparable approaches to mandatory sustainability-related disclosures across jurisdictions, are compatible with existing accounting reporting standards and promote good governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. More of sustainability-related disclosures among preparers, and form the basis for the development of an audit and assurance framework.
According to IOSCO, the TEG will be co-led by the Monetary Authority of Singapore (MAS) and the US Securities and Exchange Commission (SEC) and will comprise sustainability reporting technical specialists from within the STF and the leadership of IOSCO´s policy committee on issuer accounting, auditing and disclosures.
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