Disclosure: ISSB Makes Recommendations Regarding Scope 1, 2 and 3 Disclosures and Clarifies Materiality Standard

October 25, 2022

The International Sustainability Standards Board (ISSB), a standard-setting organization created by the International Financial Reporting Standards (IFRS) Foundation to promote consistent and reliable climate-related disclosures, has unanimously decided on a recommendation that companies disclose information on Scopes 1, 2 and 3 greenhouse gas emissions starting in early 2023. “Scope 1 covers direct emissions from a company; scope 2 covers indirect emissions from electricity purchased and used; and scope 3 covers all other indirect emissions from the value chain.” The ISSB also intends to develop relief provisions to assist companies applying Scope 3 requirements, which may include additional time to make disclosures and safe-harbor provisions.  

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