The Trustees of the IFRS Foundation proposed amendments to the Constitution of the IFRS Foundation to accommodate the potential formation of the new International Sustainability Standards Board within the governance structure of the organization. The amendments include revisions to the objectives of the IFRS Foundation and the institutional arrangements for the International Sustainability Standards Board. The consultation is open for comments until July 29, 2021. The Trustees also published a feedback statement summarizing their responses to the feedback received on the September 2020 consultation on sustainability reporting. The feedback constituted about 577 responses, which indicate growing and urgent demand for global standards and broad support for the creation of a new sustainability standards board within the governance structure of the IFRS Foundation.
The Trustees have proposed targeted amendments to the Constitution to determine whether the proposed governance structure would provide legitimate oversight of the standard-setting by a new board as well as to determine whether the proposed amendments are proportionate to the strategy of IFRS Foundation in relation to the potential work of the new board. The Trustees invite comments on the proposals to amend the Constitution to:
- Expand the objectives of the IFRS Foundation to create a board that will set IFRS sustainability standards under the governance structure of the IFRS Foundation
- Set out the structure and function of the new board
- Align other parts of the Constitution with the creation of the new board
Approval by the Trustees of the proposed amendments to the Constitution will be conditional on the establishment of the new board. The Trustees will make a final determination based on the feedback received to the exposure draft and subject to the ongoing work to satisfy the key requirements for success. The Trustees’ final determination is expected to be made in the fourth quarter of 2021. Assuming that the Trustees do finally determine to create such a board, the plans will be announced at the United Nations Climate Change Conference (also known as COP26), which is scheduled to be held in November 2021.
Comment Due Date: July 29, 2021
Keywords: International, Banking, Insurance, Securities, Sustainability Standards Board, Climate Change Risk, ESG, COP 26, Reporting, SSB, IFRS
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
Previous ArticleECB Updates Annexes to AnaCredit Reporting Manual in April 2021
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.
The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.
The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.