Technical representatives from GRI and the International Sustainability Standards Board (ISSB) begin work on delivering the agreed Memorandum of Understanding (MOU)
Released in March, the MOU sets out coordinated work programmes and standard-setting activities for both the GRI and ISSB, comprehending the need to further harmonise international sustainability reporting landscapes. viewed as two interconnected reporting pillars that address distinct perspectives, both the IFRS Sustainability Disclosure Standards and GRI Standards form a comprehensive corporate reporting regime for the disclosure of sustainability information.
In May, technical representatives from both organisations depicted how they could provide the necessary clarification and alignment. Among the initiatives discussed were:
- An agreed schedule of meetings and roadmap to develop technical aspects of the collaboration.
- A mapping programme in order to identify those requirements in draft IFRS S1 and IFRS S2 that are equivalent with GRI Standards, and to guide an exercise on alignment of disclosures, guidance, concepts and definitions.
- A comparison exercise of ISSB’s General Features and Qualitative Characteristics of Information with GRI 1: Foundation, to identify scope for alignment or explanation of differences.
- In order to maximise usefulness to preparers of information, the development of a methodology to cross-reference between guidance and other materials has been produced by GRI and ISSB respectively.
- A deep evaluation of future priorities to maximise joint standard-setting and guidance development activities.
- The development of a full explanation of the ways in which the GRI and ISSB standards respectively are complementary or diverge.
- GRI staff set out initial steps of their proposed feedback to the consultation by the European Financial Reporting Advisory Group (EFRAG) on the EU Sustainability Reporting Standards (the GRI response subsequently published on 20 June).
“The collaboration between GRI and the ISSB is significant because it reflects that both organizations value the importance of working together to align our sustainability related standards. I believe this will not only give companies greater clarity on reporting expectations, it can ultimately improve the quality and relevance of reporting data. I therefore welcome the progress achieved under our MOU so far. These outcomes are tangible first steps towards achieving the global, interconnected two-pillar system for corporate reporting, as envisaged through the MOU, which reflects the distinct yet equal importance of financial and impact materiality in sustainability reporting. We look forward to continuing to collaborate with the IFRS Foundation and the ISSB in support of this aim.”
Eelco van der Enden, CEO of GRI
“The ISSB is committed to creating a global baseline of reporting standards that meet the needs of investors. Our collaboration with GRI will bring clarity to the market on how our two standards can interact to provide a comprehensive and seamless suite of reporting standards that meet the needs of broader stakeholders, while streamlining the process for companies. This first meeting of our technical teams has been truly encouraging and I look forward to our continued collaboration.”
Emmanuel Faber, Chair of the ISSB
The requirements established by the ISSB are bound by the IFRS Foundation’s due process. Likewise, before any of these outcomes are implemented, approval will be required by the GRI Global Sustainability Standards Board.