ISSB to take over TCFD climate-disclosure monitoring from 2024

The IFRS Foundation's ISSB will assume responsibility for monitoring companies' climate-related disclosures from 2024, taking over from the FSB's TCFD. The consolidation simplifies the global disclosure landscape, clarifying for Indian companies which climate-reporting framework will anchor international expectations.

From 2024, the International Sustainability Standards Board (ISSB) of the IFRS Foundation will take over monitoring of companies' climate-related disclosures from the Financial Stability Board's Task Force on Climate-related Financial Disclosures (TCFD). The TCFD, established by the FSB in 2015, published its recommendations in June 2017, which became the industry standard and were incorporated into the ISSB's climate-related disclosure standard. The FSB requested the ISSB assume monitoring after the TCFD delivers its 2023 annual status report, reflecting ongoing consolidation of sustainability reporting standards.

The transfer affects companies, investors, governments and regulators that have adopted TCFD-aligned climate disclosure, now consolidating under the ISSB Standards launched at COP26 in November 2021. ISSB Chair Emmanuel Faber noted the ISSB built on and consolidated market-leading, investor-focused sustainability-reporting initiatives, with the TCFD recommendations at the heart of its standards. Preparers and users of climate-related financial disclosures gain a single, globally recognised reference point, reducing the fragmentation of the so-called alphabet soup of ESG reporting initiatives.

Companies and investors should track the ISSB assuming TCFD monitoring responsibilities from 2024 and align climate-disclosure practices with the consolidated ISSB Standards that embed TCFD recommendations. Indian companies preparing climate disclosures should monitor this consolidation, since the ISSB framework increasingly anchors global investor and regulator expectations and informs domestic standard-setting. Watching the TCFD's final 2023 status report and the ISSB's adoption of its monitoring role will clarify the reference framework for international climate reporting going forward.

Key figure — Transition date: ISSB assumes TCFD monitoring from 2024