UK government advisor flags “significant concerns” over ISSB sector standards

Global sustainability standard setter told to change course on SASB enhancements or risk irrelevance 

The body advising the UK government on corporate sustainability disclosure standards has told the International Sustainability Standards Board (ISSB) that it has “significant concerns” about the approach being taken to overhaul the SASB sector standards. 

The ISSB inherited the SASB standards in 2022 when its parent, the IFRS Foundation, merged with the Value Reporting Foundation. 

It closed a consultation last week on proposed changes to nine “priority” industries and “targeted amendments” to a range of other sector standards. 

But the UK’s Sustainability Disclosure Technical Advisory Committee’s (TAC) challenged the ISSB in its response to the consultation. 

“The TAC has significant concerns about the due process being applied in the ISSB’s project to enhance the SASB Standards,” the body wrote, arguing that the IFRS Foundation had used a “greater level of due process” when developing other non-mandatory guidance. 

The TAC also cited complaints from stakeholders that the SASB standards are too prescriptive and lack compatibility with the IFRS 1 and 2, particularly around “materiality and judgement principles”. 

It urged the ISSB to “develop a clear strategy” for enhancing the SASB standards and ensuring they fitted with the ISSB’s framework before pursuing amendments. 

If ISSB remained “overly attached to the status quo”, the body warned, SASB could be viewed as irrelevant and companies could disengage from the sectoral standards. 

ISSB declined to comment on the TAC’s response.