While the statement mentioned efforts by the International Sustainability Standards Board (ISSB), the U.S. Securities & Exchange Commission (SEC), and the European Commission together with the European Financial Reporting Advisory Group (EFRAG), which aim to address the need to enhance and evolve corporate reporting to include and consider sustainability information, it also said that a coordinated approach is needed to provide the comprehensive global baseline of sustainability disclosures needed by capital markets.   “A globally consistent, comparable, reliable, and assurable corporate reporting system is indispensable in providing all stakeholders with a clear and accurate picture of an organization’s ability to create sustainable value over time,” the statement said. “Interoperability helps meet the needs of global capital markets, including investors who allocate capital internationally, companies that operate and raise capital across national borders, and the accounting profession that serves all consumers of corporate reporting.”   The statement went on to say that a global baseline for capital markets will help reporting entities reduce cost, complexity, and confusion, thereby increasing the comparability of the information while serving the fundamental purpose of sustainability reporting.   For investors who allocate capital based on comparable financial and sustainability-related information, consistency is a matter of investor protection, growing market demand, and the ability to incorporate environmental, social, and governance issues into investment decisions that contribute to sustainable outcomes, the statement said.   Lastly, for professional accountants, who transform disclosure requirements into high-quality and decision-useful information, global consistency and alignment provide the best foundation for high-quality sustainability-related reporting and its assurance, the statement said.   “Together, we welcome the establishment by the ISSB of a working group to enhance compatibility between the global baseline and jurisdictional initiatives through a coordination mechanism,” the statement said. “We strongly urge all involved policymakers to engage with this platform at this current historical juncture and strive towards delivering the level of alignment needed by financial markets at the global level.”  

About the Authors