On June 2023, the European Financial Reporting Advisory Group, EFRAG, issued a draft letter requesting comments on the International Sustainability Standards Board’s, ISSB, proposal to improve the international applicability of the Sustainability Accounting Standards Board’s Standards and Taxonomy.
The proposed enhancements are intended to ensure that entities can apply the SASB Standards regardless of the jurisdiction in which they operate or the type of generally accepted accounting principles they use. The ISSB released the “Exposure Draft Methodology for Enhancing the International Applicability of the SASB Standards and SASB Standards Taxonomy Updates” on May 9, 2023, with a 90-day comment period ending August 9, 2023.
In the Draft Letter, EFRAG generally agreed that the proposed methodology would improve the international applicability of the SASB standards. However, it suggested two further potential improvements:
EFRAG recommends maintaining the comparability of SASB standards when adopting generalized jurisdictional references. Internationally applicable regulations should be relied upon as much as possible. But, because jurisdictionally bound references may differ between jurisdictions, comparability between undertakings reporting can be affected. When this is the case, priority should be given to comparability at the jurisdictional level instead of the international level. When relying on internationally applicable references, a key consideration is whether these references have been ratified because international references do not become applicable automatically in all jurisdictions. EFRAG recommends that the ISSB create and make available on its website mappings that show all internationally applicable references used and which countries have ratified these references. EFRAG also requested that the ISSB develop a gap analysis between the SASB standards and sustainability reporting frameworks developed more recently or which are in the process of being developed. The gap analysis results would then serve as a basis for updates to the SASB standards.
Some interesting links
EFRAG extends the consultation period of its draft comment letters on ISSB SASB methodology and ISSB RFI agenda consultation by one week
By Giacomo Breda
Some interesting links
EFRAG extends the consultation period of its draft comment letters on ISSB SASB methodology and ISSB RFI agenda consultation by one week
To understand EFRAG (German language version)
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