Members of the International Sustainability Standards Board (ISSB) have identified four broad topics to form the basis for an upcoming public consultation on their future workplan.
Summing up the board’s 14 December discussion, ISSB joint vice-chair Sue Lloyd said staff now have sufficient direction on “the four things that we intend to build out for inclusion as priorities for consultation”.
However, board members also instructed staff to refine their proposals to ensure that the consultation process captures a broad diversity of stakeholder opinion and takes sufficient account of other reporting frameworks and approaches.
Since its inaugural meeting in July, the board and its staff have been working toward releasing a request for information document canvassing project suggestions to build on its first two sustainability standards.
The board discussed a preliminary list of projects at its July and October meetings. Having conducted outreach with stakeholders, the staff recommended three research projects on biodiversity, human capital, and human rights in the value chain.
The fourth project proposal is the resut of joint work with the IASB on connectivity – between financial and non-financial reporting – to build upon the IASB’s Management Commentary project and incorporate the Integrated Reporting Framework.
Staff told the meeting that in light of available resources, “we feel strongly that we can make timely progress on a connectivity and reporting project” as well as on the other potential projects.
Progress on the content of the consultation depends, however, on both boards coming up with a readily understood definition of each of the proposed research projects.
In response to a question from board member Veronica Pountcheva, staff agreed that the notion of a living wage, for example, was a sub-topic of the overarching human capital topic that they will need to address in some way in the RFI.
Additionally, staff member Greg Bartholomew noted that diversity, equity, and inclusion (DEI) had emerged from staff research as a strong “potential initial focus area” for the human capital project.
Bartholomew also reminded the board that the former Sustainability Accounting Standards Board had already started a workstream on DEI.
He then hinted that the RFI could have DEI as its “initial focus”, but “also acknowledge other subtopics to allow our stakeholders to provide feedback”.
Additionally, board members noted that the board is not consulting from a blank sheet of paper but against the backdrop of established reporting frameworks such as the Global Reporting Initiative (GRI).
ISSB member Richard Barker said: “If you look at ESRS [European Sustainability Reporting Standards] – but you could look at the GRI equally – the topics that they identify in the environmental and the nature space are – apart from climate – pollution, water on marine resource, biodiversity, resource use and circular economy.
“And so I’d rather that we sort of connect with that a little bit more than just saying ’should we explore biodiversity?’”
The board’s joint vice-chair, Jingdong Hua, noting another disparity, added: “The World Bank produces a human capital index […] which has nothing to do with what we do.”
Finally, ISSB vice-chair Lloyd made clear that she was keen to manage stakeholder expectations about what they can expect from the consultation process.
She said: “I think we need to be really clear what we’re going to do with the information and how we’re going to think about it.”
In practice, Lloyd explained, resourcing constraints and how the board scopes its work might mean they do not necessarily pick the most popular project choices that emerge from the consultation.
She added, however, that the board’s eventual decisions did not mean it was ignoring feedback.
The ISSB expects to launch its agenda consultation during the first half of next year having delayed the process from the end of this year.
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