The International Sustainability Standards Board (ISSB) has tentatively agreed to give companies a temporary exemption of at least one year from the obligation to report on their greenhouse gas (GHG) emissions, relating to Protocol Scope 3 emissions.
In a statement, the board said the concession was intended to “give time for companies to implement their processes”.
ISSB joint vice chair Sue Lloyd subsequently told delegates to the COP 15 biodiversity conference that the board was aware “companies need help, as best practice continues to develop, in measuring Scope 3 emissions”.
She added, ”The ISSB believes the reliefs and guidance agreed week will provide companies with the time to get their processes in place, and the guidance to support this disclosure.”
The board is currently redeliberating the draft sustainability reporting standard, IFRS S2 climate-related disclosures to issue the final standard early next year.
This will also mean investment firms looking to report on the emissions of their portfolio companies should see refinement in the process.
The ISSB said it had approved amended financed emissions disclosures for asset managers, for example.
The ISSB also said will be defining sustainability as “inextricably” linked to nature in its disclosure standards.
“Sustainability will be described in the ISSB’s General Sustainability-related Disclosures Standard (S1) as the ability for a company to sustainably maintain resources and relationships with and manage its dependencies and impacts within its whole business ecosystem over the short, medium and long term,” the board said.
The ISSB S3 discussion follows its tentative agreement decision at its 20 October meeting to require businesses applying its climate reporting standard to include Scope 3 emissions in their disclosures.
The GHG Protocol guidelines are the result of a collaboration between governments, industry, and others with the World Resources Institute and the World Business Council for Sustainable Development.
They specify three scopes for measuring 15 different emissions categories within the corporate value chain standard.
Scope 1 includes direct emissions from business operations while Scope 2: power plant emissions from a business’s energy requirements such as power or heating.
Scope 3 comprises indirect emissions from upstream (supply chain) and downstream (consumer and waste stream emissions) activities or products.
The ISSB has also appointed two special advisers, Karin Kemper and Geordie Hungerford, and said it will be proposing upcoming projects in four key priority areas: biodiversity, ecosystems and ecosystem services; human capital; human rights; and connectivity in reporting with the IAS,
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