A Quick Guide to IFRS S1 & S2

Global Standards for Sustainability and Climate Disclosures

IFRS Foundation (International Financial Reporting Standards)

Develops and oversees global
standards

ISSB (International Sustainability Standards Board)

Develops IFRS Accounting
Standards, adopted by over 140
jurisdictions.

IASB (International Accounting Standards Board)

Develops IFRS Sustainability
Disclosure Standards to ensure
consistent sustainability reporting.

MATERIALITY IN IFRS

Definition of Materiality

Under IFRS S1, information is material if its omission or misstatement could influence investor decisions. Materiality applies to both financial and sustainability disclosures to ensure users get decision-useful insights.

How IFRS S1 & S2 Approach Materiality

OVERVIEW OF IFRS S1 & S2

IFRS S1 (General Sustainability)

IFRS S2 (Climate-specific)

IFRS S1 & S2

The Evolution of IFRS S1 & S2

CONSOLIDATION OF SUSTAINABILITY REPORTING STANDARDS

ISSB builds on TCFD and consolidates global standards like SASB, IR, and CDSB, while working with GRI to ensure interoperability.

KEY DISCLOSURE AREAS Ask ChatGPT

For IFRS S1 (General Sustainability)	For IFRS S2 (Climate-specific)
Board & management oversight of sustainability risks	Board & management oversight of climate risks
Sustainability risks, opportunities & financial impact	Climate risks, opportunities & financial impact
Identifying & managing sustainability risks	Identifying & managing climate risks
Sustainability performance indicators	Climate performance indicators

REPORTING TIMELINES

EFFECTIVE DATE

IFRS S2 applicable for annual reporting periods beginning Jan 1, 2024

ADOPTION TIMELINE

Gradual uptake expected globally, influenced by local regulators

CORE REQUIREMENTS FOR IFRS S1

IFRS S1 (General Sustainability)
Governance	Define board/committee oversight for sustainability Assign roles & outline decision-making processes
Strategy	Identify sustainability risks & opportunities Explain impact on business, strategy, & financials Align disclosures with financial reporting
Risk Management	Describe how sustainability risks are assessed & integrated into ERM Share risk monitoring and prioritization approach
Metrics & Targets	Report relevant sustainability metrics Disclose targets & track progress Align metrics with financial and industry standards

CORE REQUIREMENTS FOR IFRS S2

IFRS S2 (Climate-specific)
Governance	Define board/committee oversight for climate risks Assign responsibilities & decision-making approach
Strategy	Describe climate risks/opportunities & business impact Share financial impact, transition plans & scenario analysis
Risk Management	Explain climate risk assessment & integration into ERM Detail monitoring processes
Metrics & Targets	Disclose GHG emissions (Scope 1, 2, 3) Report carbon pricing & capital allocation Share climate targets & progress tracking

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