An international standard-setting body on disclosures announced Tuesday it will include biodiversity research in its priorities for the next two years, paving the way for potential new requirements on nature for investors.

International Sustainability Standards Board (ISSB) will assess existing standards on the topics of biodiversity, ecosystems, and ecosystem services, and decide whether additional disclosures are needed, it said in a statement.

“Beyond climate, we are committed to building out the global baseline of sustainability-related financial disclosure to meet the needs of investors,” said ISSB chair Emmanuel Faber.

“Feedback indicated a significant and growing need among investors for improved disclosures around biodiversity, ecosystems, and ecosystems services as well as human capital, as a key source of value for companies.”

ISSB opened consultations in September among companies and financial institutions to gather views on its priorities for the next two years.

In light of that feedback, the staff recommended last week that ISSB focuses on risks and opportunities associated with human capital coupled with biodiversity, ecosystems, and ecosystem services.

“The research projects will focus on the common information needs of investors in assessing whether and how these risks and opportunities could reasonably be expected to affect a company’s prospects,” ISSB said.

While disclosure of sustainability-related risks and opportunities is already required under ISSB’s IFRS S1 framework, the standard-setting body could develop additional guidance building upon the work of existing market-led initiatives, including the Taskforce on Nature-related Financial Disclosures (TNFD).

“The ISSB will look at how it might build from relevant pre-existing initiatives. This includes those already under its purview and, additionally, relevant aspects of the work of the TNFD.”

ISSB is part of the International Financial Reporting Standards Foundation (IFRS), an independent organisation that produces accounting rules used in more than 100 countries.

Its work plan for the next two years is due to be presented in June.

By Sergio Colombo – sergio@carbon-pulse.com

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