• The IFRS Foundation proposes to create a new SSB tasked with developing and maintaining a global set of sustainability-reporting standards initially focused on climate-related risks and expand into other sustainability topics in the future.
• SSB standard-setting would build on existing developments and collaborate with other bodies and initiatives in sustainability.
• The SSB will take a gradualist approach toward materiality and focus its efforts on the sustainability information it considers most relevant to investors and other market participants (i.e. financially material). It would look to broaden its scope if more jurisdictions embrace the “double-materiality” concept
• The SSB would be created using the three-tier structure that already exists under the IFRS Foundation. This structure consists of an independent standard-setting board of experts governed and overseen by a global set of Trustees who, in turn, are accountable to a monitoring board of public authorities, the IFRS Foundation Monitoring Board.
• The SSB would operate alongside the IASB, and the assumption is that the two boards would benefit from the increasing interconnectedness between financial reporting and sustainability reporting.

The PRI welcomes the IFRS proposal as a significant step towards realising a system for globally comparable corporate sustainability reporting. There is a clear need for globally harmonised sustainability reporting standards in order to support investment decision-making that prioritizes and incentivizes sustainable investment and outcomes. We recognise that there are differing perspectives across stakeholder groups and jurisdictions on sustainability disclosures and standards.

However, the limited scope in terms of materiality (only financial) and issues (only climate) may not resonate with more advanced stakeholders and jurisdictions, nor provide the full range of information on a range of sustainability topics that are material to investors. The IFRS Foundation and an SSB should establish from the outset that it will bring the full range of sustainability reporting topics and double materiality within scope of its future standards and set out a roadmap  and time line for work to work to commence on these areas.