ISSB proposes targeted changes to streamline Scope 3 disclosure
Earlier this week the International Sustainability Standards Board (ISSB) released an Exposure Draft proposing targeted amendments to IFRS S2, aiming to ease some of the thorniest climate reporting requirements—without diluting the utility of disclosures for investors.
The proposals respond to early implementation challenges and focus on Scope 3 emissions, classification standards, and jurisdictional inconsistencies.
The proposed changes would allow companies to opt out of disclosing certain hard-to-measure greenhouse gas emissions—such as those linked to derivatives and insurance underwriting. The draft also proposes flexibility around emissions measurement methodologies and global warming potential (GWP) values, where national regulations require alternatives to the Greenhouse Gas Protocol or the latest IPCC figures—a measure which should reduce the need for some companies to make the same calculations twice, but which could also threaten comparability.
These updates are designed to assuage some of those concerns, with the goal of pragmatic, high quality data that is achieved through a flexible approach to implementation. The tighter alignment with the ESRS E1 climate disclosures is clearly useful and will be especially noticeable once digital reporting kicks in.
Read and respond to the Exposure Draft here. The comment period closes 27 June 2025.
