GRI and IFRS partner on sustainability reporting interoperability
May 29th, 2024
The Global Reporting Initiative (GRI) and the International Financial Reporting Standards (IFRS) Foundation have collaborated to optimise how their standards can be used together.
They announced the agreement, under which their respective standard setting boards would work to align their reporting requirements.
The IFRS Foundation’s requirements are set by the International Sustainability Standards Board (ISSB) and the GRI requirements are set by the Global Sustainability Standards Board (GSSB).
Both organisations signed a memorandum of understanding in 2022. This outlined a collaboration agreement under which their respective standard setting boards would try to coordinate their activities.
By working to ensure the interoperability of their respective standards, the groups will reduce duplication of reporting standards for companies to minimise the reporting burden.
Last year, a survey by KPMG found 54% of the 500 top executives at US companies said the complexity of gathering the necessary data across all jurisdictions was the main reason that they would be unprepared for new financial disclosure requirements.
The two groups said their collaboration would provide a “seamless, global and comprehensive” sustainability reporting system for companies seeking guidance on their reporting.
The pair will work to identify and align common disclosures that address information needs under each of their distinct scopes and the purposes of their respective standards.
They confirmed the first order of business under the collaboration would be to build a pilot methodology. This will be based on the published GRI 101 Biodiversity Standard and the ISSB’s upcoming project on Biodiversity, Ecosystems and Ecosystem Services.
Erkki Liikanen, chair of the IFRS foundation trustees, said: “[We] believe today’s agreement solidifies and advances the MoU [signed in 2022] so that together we can reduce duplication, fragmentation and complexity in the sustainability disclosure landscape.”
Both organisations confirmed they would continue to work separately to make decisions in line with their established processes. This includes opening any proposed changes to requirements to a public consultation.
The GRI recently confirmed the interoperability of its standards with the European Financial Reporting Advisory Group (EFRAG).
Last Updated: 29 May 2024