ISSB (International Sustainability Standards Board)
The ISSB is a body under the IFRS Foundation that issues global sustainability disclosure standards. IFRS S1 (General Requirements) and IFRS S2 (Climate-related Disclosures) set the baseline for sustainability reporting worldwide, designed for investor-focused, financially material disclosures.
The ISSB was created in 2021 at COP26 to deliver a global baseline for sustainability disclosures, reducing fragmentation across jurisdictions. IFRS S2, its climate standard, fully incorporates the TCFD recommendations and requires disclosures on: climate-related risks and opportunities, their effects on strategy and financial position, governance processes, risk management, GHG emissions (Scope 1, 2, and 3), and climate-related targets and transition plans.
Unlike the EU's CSRD, which uses double materiality, the ISSB uses single (financial) materiality — focusing on sustainability issues that could reasonably affect a company's financial performance, position, or cash flows. This narrower lens aligns with the investor-focused purpose of IFRS standards.
Jurisdictions worldwide are adopting ISSB standards: the UK, Japan, Singapore, Australia, Brazil, Canada, and others have announced plans to incorporate IFRS S1 and S2 into their national frameworks. This global adoption makes the ISSB the likely baseline for international sustainability reporting convergence.
For companies reporting under multiple frameworks, ISSB's investor-focused approach provides a common foundation. CSRD requires additional impact materiality disclosures; CDP is aligned with both ISSB and CSRD. Building robust GHG accounting infrastructure serves all three frameworks simultaneously.
Frequently asked questions
What is the ISSB? +
The ISSB (International Sustainability Standards Board) is an IFRS Foundation body that issues global sustainability disclosure standards. IFRS S1 and S2 provide the baseline for investor-focused sustainability reporting, fully incorporating TCFD recommendations.
How does ISSB differ from CSRD? +
ISSB uses single (financial) materiality focused on investor impact, while CSRD uses double materiality covering both financial and environmental/social impact. CSRD generally requires more extensive disclosures. Many companies must comply with both.
Related terms
TCFD (Task Force on Climate-related Financial Disclosures)
TCFD is a framework developed by the Financial Stability Board for disclosing climate-related financial risks and opportunities. It organizes recommendations around four pillars: governance, strategy, risk management, and metrics and targets. Though the TCFD disbanded in 2023, its framework lives on through ISSB S2 and CSRD/ESRS.
CSRD (Corporate Sustainability Reporting Directive)
The Corporate Sustainability Reporting Directive (CSRD) is the European Union's mandatory sustainability reporting law. It requires companies operating in the EU above certain thresholds to disclose environmental, social, and governance (ESG) information according to the European Sustainability Reporting Standards (ESRS), with third-party assurance.
CDP (formerly Carbon Disclosure Project)
CDP is a global non-profit organization that operates the world's largest environmental disclosure system. It collects self-reported climate, water, and forest data from thousands of companies, cities, and subnational governments on behalf of investors and purchasers, scoring disclosures from A (leadership) to D– (minimal).
Carbon Accounting
Carbon accounting is the systematic process of measuring, recording, and reporting the greenhouse gas (GHG) emissions produced by an organization, product, or activity. It follows standardized methodologies — most commonly the GHG Protocol — to quantify emissions across Scope 1 (direct), Scope 2 (purchased energy), and Scope 3 (value chain) categories, producing an auditable inventory that underpins disclosure, reduction planning, and regulatory compliance.
Scope 3 Emissions
Scope 3 emissions are all indirect greenhouse gas emissions that occur in an organization's value chain — both upstream (suppliers, purchased goods, business travel, employee commuting) and downstream (product use, end-of-life treatment, investments). Scope 3 typically represents 70–90% of a company's total carbon footprint.