In early 2023, the International Sustainability Standards Board (ISSB) released its two-part standards: IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures. These two standards were developed to harmonize existing standards and frameworks and provide a clear set of disclosures for users to disclose ESG data.
The ISSB Standards are voluntary disclosures, and many APAC jurisdictions have adopted or used them as a foundation for the development of their own disclosure frameworks.
In many countries, regulatory bodies are increasingly interested in the use of the ISSB standards for standardized sustainability reporting. For example, major financial hubs like Singapore and Hong Kong have shown strong leadership in integrating ISSB standards into their local regulations. The Monetary Authority of Singapore (MAS) and the Hong Kong Securities and Futures Commission (SFC) have both indicated their support for the ISSB framework, encouraging listed companies to adopt these standards to improve ESG disclosures. Below, we dive deeper into what this means for Singapore, Hong Kong, Australia, and New Zealand.
Singapore
In 2024, the Second Minister for Finance, Mr Chee Hong Tat announced the implementation of phased-in mandatory climate-related disclosures (CRDs) in alignment with the ISSB Standards.
These mandatory disclosures apply to Listed Issuers and Large Non-Listed Companies (Large NLCos) and cover Scopes 1, 2, and 3 greenhouse gas emissions and seeking external assurance.
Scopes 1 and 2 emissions will be the first required disclosures starting in FY2025 for Listed Issuers and FY2027 for Large NLCos. Scope 3 emissions will be required for Listed Issuers in FY2027 and for Large NLCos no earlier than FY2029. External limited assurance will be required.
| TIMELINE FOR REQUIREMENTS | LISTED ISSUERS | LARGE NLCos (ANNUAL REVENUE ≥$1B AND TOTAL ASSETS ≥$0.5B) |
|---|---|---|
| CRD including Scope 1 and 2 emissions | FY2025 | FY2027 |
| CRD for Scope 3 GHG emissions | FY2026 | No earlier than FY2029 |
| External limited assurance on Scope 1 and 2 GHG emissions | FY2027 | FY2029 |
Source: ACRA Singapore
Australia
Australia’s reporting standards are aligned with the ISSB to bolster transparency and comparability on a global scale. The Australian Accounting Standards Board (AASB) is spearheading this effort with the Draft ED SR1 Australian Sustainability Reporting Standards, endorsed by the ISSB Climate Standard in 2023.
Australia has proposed timelines which aim to ease the transition to reporting. A phased approach, categorized by employee count, gross assets, and revenue, sets Group 1 to commence reporting on or after July 1, 2024, followed by Group 2 on or after July 1, 2026, and Group 3 on or after July 1, 2027.
| TIMING | REPORTING ENTITIES |
|---|---|
| Group 12024-2025 onwards | Entities required to report under Chapter 2M of the Corporations Act and that fulfill two of the three thresholds:
|
| Group 22026-27 onwards | Entities required to report under Chapter 2M of the Corporations Act and that fulfill two of the three thresholds:
|
| Group 32027-28 onwards | Entities required to report under Chapter 2M of the Corporations Act and that fulfill two of the three thresholds:
|
Source: AASB ED S1
Hong Kong and New Zealand
Other jurisdictions in APAC have adopted earlier frameworks in alignment with the Task Force on Climate-Related Financial Disclosures (the TCFD was retired in 2023 by the ISSB and has been incorporated into their standards) but have expressed intent to examine alignment with the ISSB standards.
In 2024, it was announced that The Hong Kong Institute of Certified Public Accountants would be leading efforts to develop local sustainability reporting standards in alignment with the ISSB standards. These New Climate Requirements will take effect with a phased-in approach starting in 2025.
New Zealand was one of the leaders in setting local sustainability reporting standards, known as the Aotearoa New Zealand Climate Standards (NZ CS), based on the TCFD in 2022. They have also announced that they will be conducting their planned post-implementation review of the standards in 2025 and will be considering alignment with international standards if it meets user needs and the objectives of the NZ CS.
ESG Reporting with Novata
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