IAIS Responds to ISSB Exposure Draft on Climate Disclosures

In its response, IAIS welcomes the ISSB’s draft global standard on climate-related financial disclosures and notes the importance of a globally consistent baseline climate reporting standard for insurers, both as users and preparers of climate-related disclosures. IAIS notes that the proposed creation of a Sustainability Standards Advisory Forum and a working group to consider the compatibility of the ISSB’s standards with other standard-setting activity (for example, the U.S. Securities and Exchange Commission (SEC) and the European Financial Reporting Advisory Group (EFRAG)) in the climate-related reporting and disclosures space, will significantly reduce the burden on preparers, bring greater alignment, and make disclosures more comparable. IAIS stands in favor of timely implementation of the new standard, with an aim for insurers to continue to improve the level and quality of disclosure in the clear direction as set by the new ISSB standard.

IAIS invites ISSB to consider the specific characteristics of the insurance industry as investors and underwriters of other industries. IAIS notes that increased disclosure by companies, in which insurers invest and underwrite, will be necessary to support insurers in making public disclosures of sufficient quality and detail. IAIS will continue to closely monitor progress made by the ISSB and will review the IAIS’ own standards for supervisory disclosure requirements to assess whether there are any additional revisions needed to the IAIS materials. In terms of supervisory reporting, IAIS found that ISSB disclosures are relevant as they may provide additional information in the public domain to assess risks in the global insurance sector.

Keywords: International, Banking, Insurance, ESG, Disclosures, Climate Change Risk, Exposure Draft, Supervisory Reporting, EFRAG, SEC, ISSB, IFRS, IAIS