Hong Kong Exchanges & Clearing Ltd. · HKEX:388
Hong Kong Exchanges & Clearing — IFRS Foundation — ESG Presentation (November 2021)
19 slides from Hong Kong Exchanges & Clearing's sustainability presentation, Nov 10, 2021
Slide 1: Climate First – ISSB's Plan to Converge
IFRS® Foundation Climate First – ISSB’s Plan to Converge International Sustainability Disclosure Standards Teresa Ko IFRS Foundation Trustee HKEX ESG Academy webinar series: Path to Decarbonisation with Climate Transparency Wednesday, 10 November 2021 The views expressed in this presentation are tho
Slide 2: About the IFRS Foundation
About the IFRS Foundation 2 Our organisation Our mission • Not-for-profit, public interest organisation Develop IFRS Standards that bring transparency, accountability and • Three-tier governance model efficiency to financial markets around the world 1. Monitoring Board (oversight) 2. Trustees (gover
Slide 3: Current sustainability reporting landscape
Current sustainability reporting landscape 3 International initiatives Jurisdictional initiatives • Voluntary application • Different jurisdictions, • Multiple standards different requirements • Multiple audiences • Differences in scope, ambition and pace 3
Slide 4: Consequences
Consequences 4 ‘Alphabet soup’ of requirements Cost & complexity in reporting Selective & inconsistent application of ‘Greenwashing’ risk voluntary standards Different requirements by different Lack of global comparability & consistency jurisdictions Lack of capital market rigour (mandated standards
Slide 5: Demand-driven process
Demand-driven process 5 What we asked What we heard • Demand for global sustainability • Growing and urgent demand for global standards? standards to improve consistency and • Should the IFRS Foundation play a comparability role? • Broad support for Foundation • Is the solution a sustainability-focu
Slide 6: COP26 Statement
COP26 Statement 6 “ Finance Ministers and Central Bank Governors from 40+ jurisdictions* from 6 continents joined the UK in publicly welcoming the announcement of the establishment of the ISSB and its work programme to develop a set of internationally consistent, high-quality, and reliable baseline
Slide 7: COP26 announcement
COP26 announcement 7 1. Formation of the 2. Consolidation with Climate 3. Publication of climate and International Sustainability • • Disclosure Standards Board general disclosure prototype Standards Board (ISSB) (CDSB) & Value Reporting requirements Foundation (VRF) Creates the necessary institutio
Slide 8: 1. International Sustainability Standards Board (ISSB)
1. International Sustainability Standards Board (ISSB) 8 Develop global baseline of sustainability disclosure standards Focus on meeting the information needs of investors Will enable companies to provide comprehensive sustainability information for the global capital markets Climate first but not c
Slide 9: 1. International Sustainability Standards Board (ISSB)
1. International Sustainability Standards Board (ISSB) Build on Global existing baseline and investor- building block focused approach frameworks 9
Slide 10: Global baseline approach
Global baseline approach 10 Sustainability reporting (broader multi-stakeholder focus) Reporting on all sustainability matters that reflect significant positive or negative impacts on people, the environment and the economy Sustainability-related financial disclosures (investor focus) Reporting on t
Slide 11: 2. Consolidation with VRF & CDSB
2. Consolidation with VRF & CDSB 11 Becomes part of the IFRS Foundation Additional members of Technical Readiness Working Group International Accounting Standards Board 11
Slide 12: 3. Publication of prototype requirements
3. Publication of prototype requirements 12 Climate-related General Requirements Disclosures for Disclosure of Sustainability-related Information • Recommendations – Technical Readiness Working Group to ISSB • ISSB to consider as part of initial work programme 12
Slide 13: ISSB within IFRS Foundation Governance structure
ISSB within IFRS Foundation Governance structure 13 Public accountability IFRS Foundation Monitoring Board Governance, IFRS Foundation Trustees strategy & oversight IFRS Advisory Council Independent International Accounting International Sustainability (provides standard-setting advice to Standards
Slide 14: Compatible standards to meet investors' needs
Compatible standards to meet investors’ needs 14 International IFRS Financial Accounting Accounting statements Standards Board Standards (IASB) Investors and other capital market International IFRS participants Sustainability Sustainability Sustainability Standards Board Disclosure disclosures (ISSB
Slide 15: ISSB composition
ISSB composition 15 14 board Majority Diversity in Geographical members full-time expertise and balance experience 15
Slide 16: ISSB locations
ISSB locations 16 Global footprint through multi-location presence Coverage across the Americas, Asia-Oceania and EMEA (Europe, the Middle-East & Africa) • Frankfurt & Montreal to host key functions, cooperation with regional stakeholders • Frankfurt to serve as seat of the board and office of the C
Slide 17: Steps to achieving global capital market standards
Steps to achieving global capital market standards 17 ISSB IOSCO Audit standard-setters Jurisdictions Assess Require by Comprehensive standards with Develop adopting or global baseline a view to assurance incorporating of standards recommend standards standards adoption 17
Slide 18: A few thoughts
A few thoughts 18 • Climate is a global challenge and requires a global solution • A “watershed” moment and a “game changer” • “Essential plumbing to move climate change from the fringes to the forefront of finance so that every financial decision takes climate change into account” • Sustainability,
Slide 19: Thank you
Thank you www.ifrs.org IFRS Foundation @IFRSFoundation IFRS Foundation IFRS Foundation