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ISSB: A Guide to understanding sustainability standards

Jaume Fontal
CPTO & Co-Founder
The ISSB: Understanding its importance and benefits for your company
Today, the business world is increasingly committed to environmental care, with more companies adopting sustainable practices and demonstrating that protecting the planet is possible. This shift creates the perfect scenario for laws to evolve, paving the way for businesses to embrace sustainability. As part of this movement, new regulations, protocols, and standards have emerged to guide and support organizations in this process.
One notable framework is the ISSB (International Sustainability Standards Board), which offers valuable support for companies striving to achieve sustainability. Below, we’ll explain everything you need to know about the ISSB and how your company can apply its standards to unlock its full potential.
What is the ISSB?
The International Sustainability Standards Board (ISSB) was established to assist in the creation of sustainability reports for businesses. It was launched in November 2021 due to the absence of a legal framework for corporate sustainability reporting.
The ISSB sets industry standards and practices to ensure high-quality and transparent information disclosure. Its standards are applicable to all businesses, regardless of sector. Furthermore, the ISSB works closely with the IASB (International Accounting Standards Board) to ensure seamless compliance with IFRS standards.
Key ISSB Standards
The ISSB released its first standards in June 2023, which lay the foundation for this new approach to sustainability reporting. Known as IFRS Sustainability Disclosure Standards, these are the initial standards under the ISSB framework. Here’s an overview of the two main standards:
1. IFRS S1 - General Requirements
This standard integrates financial and sustainability information, requiring disclosure of risks and opportunities related to sustainability. By presenting these two aspects together, the standard highlights their interconnectedness.
2. IFRS S2 - Climate-Related Disclosures
This standard focuses on climate-related aspects, including opportunities and risks, and is structured around the following components:
- Strategy: Companies must disclose their strategies for managing physical and transitional risks over the short, medium, and long term. Scenario analysis is crucial in this evaluation process, and companies should also report the current or anticipated financial impacts of climate change.
- Governance: This involves evaluating and disclosing information about the company’s governance and oversight of climate-related strategies. It considers the competencies of leadership and staff regarding climate change issues.
- Metrics and targets: Reports must detail sector-specific metrics, including Scope 1, 2, and 3 emissions, to assess the full impact across the value chain.
- Risk management: Companies should provide information on climate-related risk management and how these efforts are integrated into existing risk actions. The report should also prioritize climate risks alongside other corporate risks.
Benefits of applying ISSB Standards in your business
Adopting the ISSB standards offers numerous advantages for businesses. Here are some of the key benefits:
- Global standardization: The standards facilitate alignment with key frameworks like NDC (Nationally Determined Contributions) and GRI (Global Reporting Initiative), enabling a consistent approach across industries.
- Reliable information: Companies can provide trustworthy insights into their climate-related risks and opportunities, with a framework for managing these across different time horizons.
- Enhanced strategy monitoring: The standards ensure proper tracking and analysis of sustainability strategies, producing critical data for reporting.
- Equivalence between financial and sustainability data: By placing sustainability and financial data on equal footing, ISSB standards ensure that both types of information receive the same level of importance among stakeholders.
- Mandatory compliance in over 100 countries: Compliance is not only required but also enhances a company’s reputation. It reassures employees and consumers that the organization is actively contributing to environmental preservation.
Final thoughts
The ISSB standards represent a significant step forward in sustainability reporting, offering companies the tools to improve transparency, align strategies with global frameworks, and demonstrate their commitment to combating climate change. By adopting these standards, businesses can meet regulatory requirements while enhancing their reputation and fostering a culture of environmental responsibility.

Jaume Fontal
CPTO & Co-Founder
About the author
Jaume Fontal is a technology professional who currently serves as CPTO (Chief Product and Technology Officer) at Manglai, a company he co-founded in 2023. Before embarking on this project, he gained experience as Director of Technology and Product at Colvin and worked for over a decade at Softonic. At Manglai, he develops artificial intelligence-based solutions to help companies measure and reduce their carbon footprint.
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