Brazil adopts ISSB’s IFRS Sustainability Disclosure Standards
On 20 October, the IFRS Foundation issued a press release stating that the IFRS Sustainability Disclosure Standards published by the International Sustainability Standards Board (ISSB), namely IFRS S1 – General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 – Climate-related Disclosures will be incorporated into the Brazilian regulatory framework, setting out a roadmap to move from voluntary use starting in 2024 to mandatory use on 1 January 2026.
Keywords: Mazars, Thailand, Sustainability, IFRS, ISSB, Framework, Climate,ฺ Brazil
Since these two standards were published at the end of June 2023, Brazil has been the first country to announce its formal decision to adopt IFRS S1 and S2.
This move coincides with discussions between the IFRS Foundation Trustees and representatives of the region's key stakeholders (in particular financial institutions) on the need to build a more resilient, sustainable and competitive financial environment in Latin America given the increasing climate risk in these markets.
This approach is also in line with a series of initiatives launched by a number of jurisdictions in the region to standardise sustainability-related financial disclosures. Both Chile and Colombia have mandated use of the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations and SASB Standards, which the ISSB's Standards build upon. Public discussions are also ongoing in Mexico concerning the adoption of IFRS Sustainability Disclosure Standards.
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