IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information

1. Understand the standard: Download and read the IFRS S1 standard (free at ifrs.org) along with the accompanying guidance documents and illustrative examples published by the ISSB.\n2. Assess applicability: Determine whether your jurisdiction has adopted, or is aligning with, ISSB standards — check with your local securities regulator or accounting standards body.\n3. Conduct a gap analysis: Compare your current sustainability reporting practices against the four core pillars of IFRS S1 (Governance, Strategy, Risk Management, Metrics & Targets) to identify disclosure gaps.\n4. Assemble a cross-functional team: Engage finance, sustainability, legal, and investor relations teams, as IFRS S1 requires integration of sustainability disclosures with general-purpose financial reports.\n5. Map existing disclosures: Identify which existing disclosures (e.g., TCFD, SASB, GRI) can be leveraged, as IFRS S1 is designed to build on these frameworks.\n6. Prepare draft disclosures: Draft sustainability-related financial disclosures covering all required elements, ensuring they are included in or connected to the annual financial report.\n7. Engage external assurance: Arrange for independent third-party assurance or audit of your sustainability disclosures, as required by an increasing number of regulators.\n8. Publish and iterate: Include disclosures in your annual report, monitor ISSB updates and amendments, and refine disclosures each reporting cycle.

IFRS S1 requires organizations to disclose sustainability-related financial information structured around four core pillars, consistent with the TCFD framework:\n\n1. Governance: Organizations must disclose the governance processes, controls, and procedures used to monitor, manage, and oversee sustainability-related risks and opportunities. This includes identifying the board body or individual responsible for sustainability oversight and how management's role is structured.\n\n2. Strategy: Organizations must explain how identified sustainability-related risks and opportunities affect their business model, strategy, and financial planning over the short, medium, and long term. This includes scenario analysis where material, and disclosure of how the organization plans to adapt or respond.\n\n3. Risk Management: Organizations must describe the processes used to identify, assess, prioritize, and monitor sustainability-related risks and opportunities, and how these processes are integrated into the overall enterprise risk management framework.\n\n4. Metrics and Targets: Organizations must disclose quantitative and qualitative metrics used to measure and manage sustainability-related risks and opportunities, including any targets set and progress against them. Cross-industry metrics include greenhouse gas emissions (Scope 1, 2, and 3), capital deployment, and internal carbon prices.\n\nIFRS S1 also establishes overarching requirements for the quality of information — it must be relevant, faithfully represented, comparable, verifiable, timely, and understandable. Organizations are required to use IFRS S2 (climate) and SASB Standards as primary sources for identifying relevant metrics, supplemented by other frameworks where gaps exist.

IFRS S1 was issued in June 2023 and represents the most significant development in global sustainability reporting standardization in decades. Within two years of publication, over 20 jurisdictions — including Australia, the UK, Singapore, Canada, Japan, Brazil, and Nigeria — had announced plans to adopt or align their national sustainability reporting requirements with ISSB standards. The European Union, while maintaining its own ESRS framework under CSRD, has committed to ensuring interoperability with ISSB standards, reducing the double-reporting burden for multinational companies.\n\nIn terms of market positioning, IFRS S1 occupies the role of a global baseline standard for investor-focused sustainability disclosure. It is not a competitor to GRI (which focuses on broader stakeholder impact reporting) but is often used alongside it. The "GRI-ISSB interoperability" guidance published jointly in 2023 reflects this complementary positioning. IFRS S1 is widely seen as the successor to the TCFD recommendations, which the TCFD formally disbanded in 2023 after declaring its work complete — a direct endorsement of the ISSB framework.\n\nDemand for IFRS S1 expertise is growing rapidly, driven by regulatory mandates in capital markets jurisdictions. The Big Four accounting firms (Deloitte, PwC, KPMG, EY) have all invested heavily in ISSB implementation practices. However, adoption complexity remains a challenge: smaller listed companies and those in emerging markets face significant capacity constraints in meeting the standard's disclosure requirements, and the ISSB has acknowledged this through its capacity-building programs and the publication of simplified guidance for developing economies.

The IFRS S1 standard was developed by the International Sustainability Standards Board (ISSB), a body established by the IFRS Foundation at COP26 in Glasgow in November 2021. The ISSB was created in direct response to growing calls from the G7, G20, IOSCO, and global investors for a single, coherent global baseline for sustainability-related financial disclosures — replacing the fragmented landscape of voluntary frameworks that had proliferated over the prior decade.\n\nThe ISSB consolidated the work of several predecessor bodies, most notably absorbing the Climate Disclosure Standards Board (CDSB) and the Value Reporting Foundation (which itself had merged SASB and the Integrated Reporting Framework). After an extensive public consultation process — receiving over 1,400 comment letters — the ISSB published IFRS S1 (General Requirements) and IFRS S2 (Climate-related Disclosures) simultaneously in June 2023, with an effective date of January 1, 2024. IFRS S1 was explicitly designed to build on the TCFD recommendations and incorporate SASB industry-based metrics, providing a unified architecture for sustainability disclosure that could be adopted by jurisdictions worldwide.