On 2 May 2024, the IFRS Foundation and EFRAG together published guidance material on the alignment between the ISSB Standards and ESRS.
The material provides interoperability guidance for climate-related sustainability disclosures under ESRS and ISSB Standards.
Whilst there are many aligned requirements of ESRS and ISSB Standards, there are differences that entities must address to claim compliance with both.
A multi-national entity may need to comply with both sets of standards if it has reporting entities in jurisdictions that require compliance with ESRS, and reporting entities in jurisdictions that require compliance with ISSB Standards.
The definition of materiality in IFRS S1, focused on what is decision-useful to investors, is aligned with the definition of financial materiality in ESRS. But ESRS requires a double materiality assessment, considering what is decision-useful information to investors and other stakeholders.
