Global Shift: International Climate Reporting Standards Set to Expose Greenwashing and Drive Sustainability
New international sustainability reporting standards released by the International Sustainability Standards Board (ISSB) could become the global baseline for companies, as the advantages of using a single standard worldwide may outweigh the disadvantages of being more demanding than the SEC's upcoming climate reporting rules. The ISSB standards require companies to disclose material information about sustainability-related risks and opportunities, including climate-related risks and opportunities. While the SEC and EU are developing their own climate reporting regimes, there is real interest from the US corporate and investor communities in voluntarily adopting the ISSB standards. Major countries such as Australia, Canada, Japan, and the UK have indicated their intention to consider using the ISSB standards, and reporting could start as early as 2025. The adoption of a global baseline would enable consistent global data, facilitate comparison for investors, attract more climate investment, and reduce the costs of producing information.