The International Sustainability Standards Board (ISSB), a standard-setting board of the IFRS Foundation, has published Exposure Draft IFRS S2 Climate-related Disclosures (the Climate Exposure Draft) and Exposure Draft IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information (the Sustainability Exposure Draft). The Climate Exposure Draft is based on the recommendations of the Task Force on Climate-Related Financial Disclosure and incorporates industry-based disclosure requirements from the SASB Standards. The Sustainability Exposure Draft provides overall requirements for disclosing sustainability-related financial information about significant sustainability-related risks and opportunities. This bulletin provides key information on both documents and the recently launched consultations. 

Climate Exposure Draft

Objective. The objectives of the Climate Exposure Draft include, among others, requiring disclosure of information about exposure to significant climate-related risks and opportunities, enabling users of an entity’s general purpose financial reporting to:

  • Assess the effects of significant climate-related risks and opportunities on enterprise value.
  • Understand how the use of resources, and corresponding inputs, activities, outputs and outcomes support responses to and strategy for managing significant climate-related risks and opportunities.
  • Evaluate the ability to adapt planning, business model, and operations to significant climate-related risks and opportunities.
  • Enable users of general-purpose financial reporting to understand the governance processes, controls, and procedures used to monitor and manage climate-related risks and opportunities and the strategies for addressing significant climate-related risks and opportunities.

Scope. The Climate Exposure Draft would apply to climate-related risks an entity is exposed to including physical and transitional risks, and climate-related opportunities available to an entity.

Sustainability Exposure Draft

Objective. The objectives of the Sustainability Exposure Draft include, among others:

  • Require disclosure of significant sustainability-related risks and opportunities useful to the primary users of general purpose financial reporting when assessing enterprise value and deciding whether to provide resources.
  • Require disclosure of material information about exposure to all significant sustainability-related risks and opportunities.
  • Require general purpose financial reporting to include a complete, neutral, and accurate depiction of sustainability-related financial information.
  • Provide guidance on how to disclose sustainability-related financial information allowing users of this information with a sufficient basis to assess the implication of the risks and opportunities on the reporting entity’s value.
  • Prescribe the basis for disclosing sustainability-related financial information that is comparable to previous disclosures and is connected to general purpose financial reporting.

Scope. The scope of the Sustainability Exposure Draft is directed at

  • Preparing and disclosing sustainability-related financial information in accordance with IFRS Sustainability Disclosure Standards (not including sustainability-related risks and opportunities that are not reasonably expected to affect assessments of enterprise value).
  • Profit-oriented entities, including public-sector business entities, and may need to be amended for not-for-profit activities in the private sector.

Core content. The Sustainability Exposure Draft permits or requires disclosure related to:

  • Governance processes, controls and procedures to monitor and manage sustainability-related risks and opportunities.
  • Approaches for addressing sustainability-related risks and opportunities affecting business models and strategy over the short, medium, and long term.
  • Processes used to identify, assess, and manage sustainability-related risks.
  • Information used to assess, manage, and monitor performance in sustainability-related risks and opportunities over time.

Consultation. The ISSB is seeking feedback and comments from stakeholders by July 29, 2022. Interested stakeholders can complete surveys on the Climate Exposure Draft and Sustainability Exposure Draft and/or provide feedback through comment letters.

For further information on the contents of this bulletin or assistance with comments, please contact Lisa DeMarco at


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