FAQ

The IFRS Sustainability Disclosure Standards issued by the International Sustainability Standards Board (ISSB) (also referred to as the ISSB Standards) form the global baseline for sustainability-related disclosures and build upon the SASB Standards and the TCFD Recommendations. Through IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, the ISSB requires companies to consider the SASB Standards, in the absence of specific IFRS Sustainability Disclosure Standards, to identify sustainability-related risks, opportunities and related information to disclose.

The SASB Standards are used in over 3,200 companies in more than 80 jurisdictions around the world, including 75% of the S&P Global 1200 Index, because industry-based sustainability disclosures are cost-efficient for companies and decision-useful for investors. Businesses worldwide use SASB Standards to better identify, manage and communicate the material information about sustainability-related risks and opportunities they face.

Companies that apply the SASB Standards now will find they are an efficient solution for disclosing sustainability information and a solid foundation for adopting IFRS Sustainability Disclosure Standards in the coming years.

Whether you are planning to adopt the ISSB Standards early or in 2024¹, adopting or continuing to use the SASB Standards will help you because:

• IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information requires companies to consider the SASB Standards, knowing that those 77 industry-based disclosure standards provide investors with comparable, decision-useful information.
• IFRS S2 Climate-related Disclosures requires industry-specific disclosures and provides industry-based metrics derived from the SASB Standards as illustrative guidance.
• The ISSB intends to make the industry-based metrics mandatory in the future, subject to consultation.

The ISSB actively encourages preparers and investors to continue to use the SASB Standards. They will be maintained and enhanced, through rigorous due process, under the ISSB throughout their continued existence.

¹The first two ISSB Standards are effective for reporting periods beginning on or after January 1, 2024. Early adoption is permitted but must be disclosed. Various transition reliefs are available, including the ability for an entity to report on only climate-related risks and opportunities (as set out in IFRS S2) in the first year it applies IFRS S1 and IFRS S2. The SASB Standards as well as all SASB Standards implementation tools and resources, now part of the IFRS Foundation, are still accessible via sasb.org.

A group of ISSB members—chaired by Jeff Hales, former Chair of the SASB Standards Board—has been established and tasked with developing recommendations for the ISSB related to the maintenance, evolution and enhancement of the SASB Standards. The group will develop drafts of the required exposure drafts of amendments to the SASB Standards and, after considering the stakeholder feedback, drafts of the final amendments. The ISSB as a full board will consider the recommendations of this group in ISSB meetings (which are public) and ratify the exposure drafts and, subsequently the final amendments prepared by the group. The comment period for the exposure drafts will be the same as for those related to IFRS Sustainability Disclosure Standards.

In June 2023, the ISSB released updated SASB Standards to align the climate-related disclosure topics and metrics with IFRS S2 Climate-related Disclosures.

In December 2023, the ISSB completed a set of enhancements to the SASB Standards to improve their international applicability, thereby providing a solid footing for companies using them to apply IFRS S1 from 2024.

Further enhancements to the SASB Standards will be determined via public consultation. Stay up to date on the ISSB’s work plan, decisions and projects by subscribing to receive sustainability alerts via the IFRS Foundation’s notifications dashboard.

Industry-based disclosures are cost-efficient for companies and useful for investors. Using industry-based disclosure topics and metrics in the SASB Standards enables companies to address a range of sustainability-related risks and opportunities.

IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information provides the basis for achieving a truly global baseline of sustainability disclosure that meets investor needs. You can think of it as an outline: the overarching standard that applies to all sustainability-related risks and opportunities but does not specify what those risks and opportunities are.

To help companies identify their sustainability-related risks and opportunities and provide appropriate disclosures using IFRS S1, companies are required to consider the industry-based SASB Standards for topics beyond climate.

IFRS S2 Climate-related Disclosures provides the details for how to meet investor needs for climate disclosures. It is based on the TCFD Recommendations with industry-specific climate metrics based on the SASB Standards.

To help companies determine which climate metrics to disclose, IFRS S2 includes industry-specific metrics derived from the SASB Standards as accompanying guidance.

All open SASB Standards projects were transitioned to the ISSB as of August 1, 2022, when the Value Reporting Foundation consolidated into the IFRS Foundation. The SASB Standards Board’s recommended changes were passed to the ISSB for further deliberation and will be subject to the IFRS Foundation’s due process.

Work is expected to continue on these projects, although public consultation on the ISSB's future agenda priorities will inform their detailed delivery plan.

Oversight of the SASB Standards has transitioned from the SASB Standards Board to the International Sustainability Standards Board (ISSB) of the IFRS Foundation. To stay informed about the work of the ISSB and receive notifications of IFRS Sustainability Disclosure Standards exposure drafts open for public comment, visit the IFRS Foundation's notifications dashboard.

Oversight of the SASB Standards has transitioned from the SASB Standards Board to the International Sustainability Standards Board (ISSB) of the IFRS Foundation. The IFRS Foundation transparently provides stakeholders with a view into the ISSB’s agenda, activities, deliberations, decisions, active projects and other standards-related updates.

In 2023, the ISSB enhanced the international applicability of the SASB Standards and will continue SASB Standards projects handed over by the VRF subject to public consultation.

Visit the IFRS Foundation notifications dashboard to stay informed about the work of the ISSB.

There is broad support in global capital markets for all companies—regardless of their industry—to disclose their Scope 1, Scope 2 and (where feasible) Scope 3 greenhouse gas (GHG) emissions. For this reason, IFRS S2 Climate-related Disclosures includes cross-industry disclosure requirements for Scope 1, Scope 2 and Scope 3 GHG emissions (subject to an entity’s determination that information regarding those emissions is material). The approach to climate-related disclosure in the SASB Standards is different but not in conflict with such cross-industry reporting.

A subset of 22 SASB Standards include disclosure topics and metrics regarding direct (Scope 1) emissions, because the SASB standard-setting process identified those industries as the most likely to face financial effects specifically related to their emissions. These effects may manifest as regulatory risks and shifts in consumer demand, which in turn affect costs and revenues.

For indirect emissions, SASB Standards capture the operational and/or strategic factors that give rise to such emissions. For the 35 industries that indirectly contribute to greenhouse gas emissions through significant use of purchased electricity (i.e., Scope 2), SASB Standards contain metrics related to understanding the amount, type (conventional or renewable) and source (self-generated or purchased) of energy.

For industries that indirectly contribute to greenhouse gas emissions upstream (e.g., from purchased materials processing and transportation), downstream (e.g., from distribution and use of products) or in other ways (e.g., from employee commuting and business travel)—in other words, Scope 3 emissions—SASB Standards recommend metrics directly related to performance in those areas.

For more information on the approach to GHG emissions and related topics in the SASB Standards, see the SASB Climate Risk Technical Bulletin.

Human capital issues are well-represented throughout the 77 SASB industry standards, as detailed in the SASB Human Capital Bulletin. However, many issues are rapidly evolving and both companies and investors are increasingly attuned to their financial implications. As a result, investor expectations for human capital disclosure are rising. With this in mind, SASB Standards research staff undertook the Human Capital research project with the objective of evolving the content of the Standards in light of emerging trends.

In December of 2021, the SASB Standards Board approved a new standard-setting project evaluating whether and how to address the themes of diversity, equity and inclusion in 45 industries. More information on that project can be found on the DEI project page.

These projects were transitioned to the ISSB upon consolidation of the Value Reporting Foundation into the IFRS Foundation in August 2022. The consultation on the ISSB's future agenda priorities will inform the delivery plan for these projects.

Water and wastewater management is one of the more prevalent issues addressed in SASB Standards, appearing in 25 of 77 industries. However, in many cases, the issue can have diversified impacts on operating risk and financial performance from one industry to the next, and these differences are reflected in the SASB Standards content.

Water risk impacts are physical in nature, such as those driven by limited natural water availability, competition for water resources and watershed pollution. SASB Standards consider two high-level categories of physical water risk: access to water and water quality. Additionally, SASB Standards consider how the regulatory environment can affect physical water risks and a company’s ability to manage those risks.

Metrics can be categorised in the following ways:

• "Industry-based" metrics are those that are tailored to a particular industry context.
• “Industry-agnostic” metrics are those that can be used to measure performance on a topic in a range of different industry contexts.
• “Cross-industry” metrics are applied consistently across all industries.

Because SASB Standards are designed to identify and standardise disclosure for the sustainability-related risk and opportunities most relevant to investor decision-making in each of 77 industry verticals, SASB Standards are industry-based and primarily contain industry-based metrics. However, many risks and opportunities cut across industries and sectors and those issues in many cases can be measured consistently across different business models (i.e., using "industry-agnostic" metrics). For example, SASB disclosure topics related to energy management (35 industries), employee health and safety (26 industries) and water management (25 industries) use identical or near-identical metrics in most relevant industry contexts.

SASB Standards do not currently contain "cross-industry" quantitative metrics, although demand has increased for certain metrics—such as those related to human capital management and climate change—to be more consistently applied across all industries. For qualitative disclosure, SASB Standards Application Guidance recommends that all companies disclose information about their governance, strategy and risk management for all SASB disclosure topics.

No. The scope of monetary losses included in the disclosure shall include only the losses that were accrued (i.e., on the statement of profit or loss) during the reporting period, which might differ from the amount paid in that period. The entity shall report the net amount of any loss or gain, including amounts reported in a prior period that are reversed during the current reporting period.

Although reporting companies may face different thresholds for recognition (i.e., “probable”) depending on whether they are reporting under local GAAP or IFRS Accounting Standards, SASB Standards Application Guidance recommends that, when providing disclosure in accordance with SASB Standards, companies do so in a way that is consistent with their financial reporting.

All losses accrued during the current reporting period shall be included in the scope of disclosure.

Providing sustainability disclosures using SASB Standards is a cost-effective way to provide decision-useful information to investors and puts companies in a prime position for implementing IFRS Sustainability Disclosure Standards. A good place to start is reviewing the SASB Standard(s) for your industry (or industries) and the SASB Standards Implementation Primer. Additionally, a number of case studies and Q&As with reporting companies may provide useful insights on getting started. Finally, it may be valuable to review the disclosures of other SASB Standards reporters in your industry.

For a company that operates in multiple industries, more than one industry Standard may be required to address the full array of sustainability topics reasonably likely to influence investors’ decision-making. Please consult the SASB Standards Application Guidance and "Understanding SASB Standards" within the SASB Standards Implementation Primer for further information. 

A company determines for itself which SASB Standards are relevant to its business, which disclosure topics represent significant sustainability-related risks or opportunities, and which associated metrics to report. When a company determines that a sustainability topic is relevant to its business objectives, SASB Standards offer a way to provide standardised disclosure on that topic, for the benefit of both companies and investors.

Informed by extensive investor feedback, SASB Standards Application Guidance recommends that when a company omits or modifies a SASB metric, it should disclose its rationale for doing so. Companies using the SASB Standards as part of their implementation of ISSB Standards should consider the relevant ISSB application guidance.

SASB Standards are designed to address sustainability factors that are applicable to the typical company within an industry. In some cases they may:

• Include topics that, for certain companies, may not represent a significant risk or opportunity; and/or
• Not necessarily include every sustainability factor that is relevant to a reporting company.

The SASB Standards Application Guidance recommends that a company disclose its rationale when it omits or modifies a SASB metric. Companies using the SASB Standards as part of their implementation of ISSB Standards should consider the relevant ISSB application guidance.

When choosing to include additional topics in its disclosure, a company should consider providing a narrative describing why the topic is important and reviewing other SASB industry standards in which the topic is covered to ensure that metrics are well-aligned with those commonly in use.

For more information, see Understanding SASB Standards.

No. Companies are responsible for determining which SASB disclosure topics represent significant risks or opportunities for their business and which associated metrics warrant disclosure, taking the company’s business model, business strategy and relevant legal requirements into account. A company can make a disclosure using the SASB Standards and, in doing so, state that it has not concluded that the information is material.

Companies using the SASB Standards as part of their implementation of ISSB Standards should consider the relevant ISSB application guidance.

As an independent standard-setter, the IFRS Foundation does not provide advisory or assurance services. We recommend that reporting companies seek the advice of professional consultants, assurance providers, and legal counsel when preparing disclosures in accordance with SASB Standards. For technical questions about how to interpret or apply the Standards, contact SASB Standards technical staff.

For answers to licensing questions, please see IFRS Sustainability licensing FAQs.

In response to the demand from investors and businesses to simplify the global sustainability disclosure landscape, the IFRS Foundation formed the International Sustainability Standards Board (ISSB), bringing together the Climate Disclosure Standards Board and the Value Reporting Foundation (which housed the SASB Standards and the Integrated Reporting Framework). The ISSB is developing a global baseline of sustainability-related disclosure standards (the IFRS Sustainability Disclosure Standards) and a taxonomy to facilitate digital reporting, building upon the existing work of market-led investor-focused reporting initiatives, including the SASB Standards, the Task Force for Climate-related Financial Disclosures (TCFD) and the World Economic Forum. IFRS Sustainability Disclosure Standards will enable companies to provide comprehensive information about sustainability matters to the financial markets, emphasising consistency and connectivity between financial statements and sustainability-related disclosures.

IFRS Sustainability Disclosure Standards direct companies to the industry-based SASB Standards as priority materials for identifying sustainability risks and opportunities. Specifically:

• In IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, to help companies identify their sustainability-related risks and opportunities and provide appropriate disclosures using IFRS S1, companies are required to refer to and consider the applicability of the industry-based SASB Standards for topics beyond climate.
• IFRS S2 Climate-related Disclosures is based on the TCFD Recommendations and includes industry-specific climate metrics derived from the SASB Standards as accompanying guidance.

SASB Standards can be used to provide investor-focused sustainability disclosures in the absence of specific IFRS Sustainability Disclosure Standards. Similarly, SASB Standards enable robust implementation of the Integrated Reporting Framework, providing the comparability sought by investors.

Other sustainability-related disclosure frameworks serve their own unique purposes, and ultimately, companies must evaluate and decide which meet the needs of their key stakeholders.

Prior to the establishment of the ISSB, investors increasingly coalesced around a combination of the TCFD recommendations and SASB Standards as foundational tools to provide capital markets with effective climate- and sustainability-related financial disclosure. As such, the ISSB’s first two standards, IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures, combine key aspects of the two.

IFRS S1 and IFRS S2 fully incorporate the TCFD Recommendations, so companies will not need to apply both the TCFD Recommendations and ISSB Standards. An entity applying IFRS S2 would also satisfy the TCFD Recommendations. IFRS S1 requires companies to consider the SASB Standards as a source of guidance, in the absence of a specific IFRS Sustainability Disclosure Standard, for identifying sustainability-related risks and opportunities and appropriate information to disclose. IFRS S2 includes climate-related metrics derived from the SASB Standards as accompanying guidance.

Therefore, companies that already apply the TCFD Recommendations and the SASB Standards are in prime position to apply the ISSB Standards. For more information about how the TCFD recommendations and SASB Standards fit together, see the SASB Climate Risk Technical Bulletin. Visit the IFRS project page for information on the ISSB's IFRS S2 Climate-related Disclosures.

Within the growing field of sustainability-related disclosure, a variety of frameworks and standards have been developed to help establish a foundational layer of relevant, comparable and reliable data from companies.

• Disclosure frameworks, like the Integrated Reporting Framework, provide a set of principles-based guidance for how information is structured and prepared, and which broad topics are covered.
• Disclosure standards, like the IFRS Sustainability Disclosure Standards, provide specific, replicable and detailed requirements for what should be reported for each topic. In other words, standards make frameworks actionable by providing comparable, consistent, reliable information.

Disclosure frameworks and standards are complementary and designed to be used together.

SASB Standards and the Global Reporting Initiative (GRI) Standards are compatible standards for sustainability reporting. They are designed to fulfil different purposes and are based on different approaches to materiality. SASB Standards focus on sustainability issues most likely to influence investor decision-making. GRI Standards focus on the economic, environmental and social impacts of a company in relation to sustainable development, which is of interest to a broad range of stakeholders.

Many companies—including ArcelorMittal, PSA Group, Diageo, and Nike—have used both SASB Standards and GRI Standards to meet the needs of their audiences.

Still, both organisations recognise that the sustainability disclosure landscape can appear complicated, and for companies that use both sets of standards, the reporting effort can be high. To help address this, a joint paper demonstrates how some companies—including General Motors and Suncor Energy—have used both sets of standards together and the lessons that can be shared.