The publication of the first two IFRS® Sustainability Disclosure Standards1 is a key milestone in the International Sustainability Standards Board (ISSB)’s vision – to create a global baseline for investor-focused sustainability reporting that local jurisdictions can build on.

The standards are designed to meet the needs of all companies, not just the most sophisticated. They provide a clear idea of what companies need to report to meet the needs of global capital markets – providing investors with globally comparable information.

Realising a global baseline

The ISSB’s first two standards are designed to be applied together, supporting companies to identify and report information that investors need for informed decision making – in other words, information that would affect the assessments that investors make about companies’ future cash flows.

To achieve this, the general standard provides a framework for companies to report on all relevant sustainability-related topics across the areas of governance, strategy, risk management, and metrics and targets.

This is supported by more detailed guidance on how to report on climate-related risks and opportunities in the climate standard. In the future, additional standards covering other topics are expected – but in the meantime companies will use guidance highlighted in the general standard to report on other topics.

The standards are effective from 1 January 2024, but it will be for individual jurisdictions to decide whether and when to adopt.

Our Sustainability reporting resource centre provides you the latest on the ISSB's deliberations and our insights.

What does this mean for Australia?

In October 2023, the Australian Accounting Standards Board (AASB) released an exposure draft (ED) for disclosure of climate-related financial information.

The ED includes three proposed Australian Sustainability Reporting Standards (ASRS Standards) that include modifications to the baseline of the ISSB™ Standards with a climate-first approach. It is proposed to be applicable for both profit and not-for-profit entities.

The AASB is proposing the ASRS Standards would apply to annual reporting periods beginning on or after 1 July 2024. However, the financial period in which an entity is first required to apply these ASRS Standards will be subject to decisions of the Australian Government – see below.

Read more in Reporting Update 23RU-13 >


The AASB has already formally endorsed its support of the voluntary adoption of the recommendations made by the TCFD. The statement is an interim position and a means of providing direction for stakeholders prior to the finalisation of the ASRS Standards.

On 27 March 2024, the climate-related financial disclosures Treasury Bill was introduced into Parliament.  Given the Parliamentary timetable, debate will be in May 2024 at the earliest.

The Bill is largely consistent with Treasury’s exposure draft legislation released in January 2024. The main change is that the commencement date for reporting is now proposed to be financial years beginning on or after 1 January 2025 (or later). Subject to Parliamentary processes, this means:

  • 31 December 2025 year ends will report first, and
  • First mandatory reporting date for 30 June year ends will now be 30 June 2026 not 30 June 2025.

The Bill is the culmination of a series of Exposure draft legislation is the outcome of previous discovery and design consultations and proposes amendments to legislation covering:

  • Reporting entities – those with Corporations Act Chapter 2M reporting obligations meeting prescribed thresholds  will be required to prepare a sustainability report
  • Phasing – timing of first reporting based on size or level of emissions
  • Reporting content – as required by ASRS Standards (see above)
  • Reporting framework – within a sustainability report in the annual report and lodged in accordance with current annual reporting requirements 
  • Assurance requirements – phased approach with reasonable assurance of all climate disclosures made from 1 July 2030 onwards
  • Liability and enforcement – modified liability approach for both directors and auditors to disclosures of Scope 3 emissions, scenario analysis, transition plans and climate-related forward looking statements

Read more in Reporting Update 24RU-04 >


Driving global consistency

The ISSB did not start from scratch in developing the ISSB Standards – they are based on existing frameworks and standards, including TCFD2 and SASB.3

The ISSB has also been working closely with jurisdictional standard setters to maximise interoperability between its standards and incoming mandatory reporting frameworks – e.g. the European Commission and EFRAG4 in the EU, and the SEC5 in the US.

Connecting sustainability and financial reporting

Reporting would be connected to the financial statements and released at the same time. Therefore, companies will need processes and controls in place so that they can provide sustainability information of the same quality, and at the same time, as their financial information.

Getting ready now is critical. Companies that already have the processes in place to produce similar sustainability-related information are likely to find reporting under the final standards easier.

What do you need to do now?

  • Get familiar with the proposals for the ASRS Standards and consider making a submission to the AASB by 1 March 2024.
  • Get familiar with the Treasury Exposure draft legislation, understand when the proposals apply to you and provide feedback by 9 February 2024.
  • Educate your organisation on sustainability-related risks and opportunities and what they mean for the company.
  • Establish a board-led governance structure that brings both finance and sustainability reporting to the boardroom table when making commitments, decisions and reporting on sustainability-related issues.
  • Engage with current process owners and understand how information is being defined, captured and reported, and where there are control gaps.
  • Expand your systems, processes and controls to create efficiencies and move certain aspects of the data collection and calculation process into existing or new systems and processes.

Publications and downloads

Read our publication comparing proposals from the ISSB to the proposed ASRS Standards.

AASB releases exposure draft on climate reporting

Read our guide for a high-level summary of the ISSB requirements, the impact, and next steps – including ten key questions that can help you with your preparations.

Get ready for ISSB sustainability disclosures (PDF 1.7MB)

Explore our First Impressions publication for detailed insights on the key impacts of the ISSB standards, using illustrative examples and including how companies might apply them.

Sustainability reporting: General and climate-related requirements (PDF 1.6MB)

Read our publication comparing proposals from the ISSB, EFRAG and SEC where you are a multinational organisation and to gain further insight on some of the practical challenges you may encounter as you prepare for the new sustainability reporting standards.

Comparing sustainability reporting proposals

How KPMG can help

Connect with us


1. IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures.

2. Task Force on Climate-related Financial Disclosures.

3. Sustainability Accounting Standards Board.

4. European Financial Reporting Advisory Group.

5. Securities and Exchange Commission.