Briefly describe the requirements of the new IFRS-S sustainability standard.

Question 1

What is the overarching aim of the IFRS Sustainability Disclosure Standards (IFRS S1, IFRS S2)?

Answer 1

They establish a global baseline of sustainability‐related disclosures to help investors assess how sustainability issues affect enterprise value over the short, medium, and long term.

Question 2

How do IFRS S1 and IFRS S2 differ in focus (IFRS S1, IFRS S2)?

Answer 2

IFRS S1: Sets general requirements for sustainability‐related financial disclosures (governance, strategy, risk management, metrics, and targets).
IFRS S2: Adds climate-specific disclosure requirements (e.g., greenhouse gas emissions, scenario analysis).

Question 3

What key principles underlie the disclosure requirements of IFRS S1 (IFRS S1)?

Answer 3

Materiality (investor‐focused)
Completeness & Accuracy
Consistency & Comparability
Connectivity of Information (linking financial and non‐financial data)

Question 4

Under IFRS S1, which core content areas must organizations address (IFRS S1)?

Answer 4

Governance of sustainability issues
Strategy (risks/opportunities)
Risk Management processes
Metrics & Targets for performance tracking

Question 5

What additional requirements does IFRS S2 impose for climate‐related disclosure (IFRS S2)?

Answer 5

GHG Emissions (Scope 1, 2, and possibly 3)
Scenario Analysis (resilience testing)
Transition & Physical Risks (financial impacts of regulatory and climate events)

Question 6

Why are IFRS S1 and IFRS S2 considered more investor‐focused than other sustainability frameworks (IFRS S1, IFRS S2)?

Answer 6

They emphasize enterprise value and the information needs of capital markets, rather than broader stakeholder impacts for their own sake.

Question 7

Example structure for Question 1 (in bullet form):

Answer 7

Point on Purpose: “IFRS S1 and S2 aim to set a global baseline of sustainability disclosures for investors.”
Scope: “IFRS S1 covers general sustainability; IFRS S2 focuses on climate.”
Materiality: “Both standards emphasize investor‐focused materiality (enterprise value).”
Governance: “Disclosure of board/management oversight of sustainability.”
Strategy: “Companies must report how sustainability risks/opportunities affect strategic direction.”
Risk Management: “Clear processes for identifying and managing sustainability risks.”
Metrics/Targets: “Organizations must provide quantifiable KPIs (e.g., GHG emissions).”
Comparability: “Standardized structure (IFRS) for consistent data across periods/entities.”