In a world where the urgency of climate change and the preservation of biodiversity have taken centre stage, organisations find themselves facing an unprecedented challenge: how to swiftly adapt to evolving sustainability codes, standards, and regulations. Sustainability is a transformational force that can define an organization’s longevity and success. The need to incorporate sustainability into the core operations of organisations has become not just a moral imperative, but a strategic necessity.
Integrated Thinking: A Key to Sustainable Business
At the heart of this transformation lies the concept of integrated thinking – the process of seamlessly weaving sustainability considerations into an organization’s decision-making processes. This goes beyond simple compliance; it’s about fundamentally reimagining how businesses operate in harmony with the planet and society.
The integrated thinking journey often requires a paradigm shift for organisations which will include changes in organisational structures, capacity building and embedding a culture of purpose-driven values across the organisation. It means that organisations have to move towards stakeholder capitalism and aligning its purpose and values with the expectations of all stakeholders in society – employees, suppliers, communities, and the environment, along with shareholders.
Corporate Secretaries in the Era of Sustainability
For Corporate Secretaries, this means understanding and incorporating a broader range of business information, beyond just financial data, into the Board’s decision-making processes. Integrated thinking allows Corporate Secretaries to consider the impact of the Board’s decisions on the organization’s social, environmental, governance (ESG) and economic performance, and to identify opportunities to create long-term sustainable value.
With an overwhelming amount of information and guidelines emerging at a rapid pace, organisations worldwide are in search of a comprehensive framework that can guide their journey towards integrating sustainability into their core fabric. This can be a daunting task for organisations as they are faced with a myriad of challenges including differing jurisdictions, regulations and standards of practice.
The Role of International Sustainability Standards Board (ISSB)
The establishment of the International Sustainability Standards Board (ISSB) by the International Financial Reporting Standards (IFRS) Foundation was a welcome initiative, with the purpose of creating a global baseline for investor-focused sustainability reporting that local jurisdictions can build on. This is critical for countries sourcing climate-focused investments, organisations operating across different jurisdictions and for organisations of different sizes to enable allowances for more flexible and proportionate reporting.
The ISSB Standards build upon existing frameworks and standards, including the TCFD Recommendations, the Integrated Reporting Framework, and the SASB Standards. The IFRS Foundation therefore encourages organizations to adopt the SASB Standards to get prepared to implement IFRS S1 and IFRS S2.
ISSB has released two sets of standards: IFRS S1: General Sustainability Disclosures which references the SASB Standards to identify sustainability risks and opportunities that could impact an organization’s ability to create value. IFRS S2: Climate disclosure standards which includes industry-based guidance which incorporates climate-related considerations like physical and transition risks, climate resilience, and GHG emissions.
The establishment of the International Sustainability Standards Board (ISSB) by the International Financial Reporting Standards (IFRS) Foundation was a welcome initiative, with the purpose of creating a global baseline for investor-focused sustainability reporting that local jurisdictions can build on. This is critical for countries sourcing climate-focused investments, organisations operating across different jurisdictions and for organisations of different sizes to enable allowances for more flexible and proportionate reporting.
The ISSB Standards build upon existing frameworks and standards, including the TCFD Recommendations, the Integrated Reporting Framework, and the SASB Standards. The IFRS Foundation therefore encourages organizations to adopt the SASB Standards to get prepared to implement IFRS S1 and IFRS S2.
ISSB has released two sets of standards: IFRS S1: General Sustainability Disclosures which references the SASB Standards to identify sustainability risks and opportunities that could impact an organization’s ability to create value. IFRS S2: Climate disclosure standards which includes industry-based guidance which incorporates climate-related considerations like physical and transition risks, climate resilience, and GHG emissions.
Paving the Way for a Sustainable Tomorrow
As the Board is responsible for sustainability reporting, Corporate Secretaries as the gatekeepers of governance and trusted advisors to the Board, as well as serving as the bridge between management and the Board, have a critical role in building capacity at Board and management level to guide companies in preparing for the transition and strengthening their governance frameworks for sustainability and ESG reporting.
It is both a challenging and exciting time for Corporate Secretaries as they have the opportunity to forge a path towards integrating sustainability seamlessly, enhance long-term success, and foster a more sustainable future.
A more sustainable world starts with the actions we take today – let’s pave the way for a sustainable tomorrow!
