ISSB consults on proposed IFRS Sustainability Disclosure Taxonomy until September 2023

The International Sustainability Standards Board released the Proposed IFRS Sustainability Disclosure Taxonomy for public comment during a 60-day period ending September 26, 2023, to enable digital tagging of disclosures under IFRS S1 and S2. As ISSB standards influence India's disclosure direction, a common digital taxonomy could shape how Indian companies structure machine-readable sustainability data.

The International Sustainability Standards Board (ISSB) released the Proposed IFRS Sustainability Disclosure Taxonomy for public comment, aligned with the disclosure requirements in its first two standards, IFRS S1 and IFRS S2. The digital taxonomy is designed to enable digital tagging of information required by the standards, making sustainability-related financial disclosures consumable in a digital format and improving global accessibility and comparability for investors. The 60-day consultation period concludes on September 26, 2023, with the final taxonomy expected in early 2024. ISSB Chair Emmanuel Faber emphasised facilitating digital consumption of sustainability information for investors.

The proposed taxonomy affects companies that will report under ISSB standards, investors consuming sustainability data digitally, and software and reporting-platform providers enabling structured disclosure. For Indian companies, given the ISSB standards' growing global influence and relevance to domestic disclosure frameworks, a common digital taxonomy matters for how machine-readable sustainability data is prepared and compared. Indian preparers, auditors, and technology providers may eventually need to support digital tagging aligned with IFRS S1 and S2, distinct from taxonomies that classify economic activities as sustainable.

The 60-day consultation concludes on September 26, 2023; the ISSB planned to review feedback in the second half of 2023 and issue the final digital taxonomy in early 2024, and hosted a webinar on August 3, 2023, featuring ISSB Member Bing Leng. Indian companies, auditors, and reporting-technology vendors should track the taxonomy's finalisation and assess readiness for digital tagging of sustainability disclosures, while monitoring ISSB interoperability efforts that aim to harmonise reporting across jurisdictional requirements.

Key figure — Consultation deadline: September 26, 2023 (60-day comment period)