ISSB Plans Practice Statement on Nature-Related Disclosures

Why It Matters

Standardized nature‑related disclosure guidance will enable consistent reporting, reducing investor uncertainty and supporting global sustainability integration.

Key Takeaways

• ISSB to issue nature‑related disclosures practice statement
• Statement will guide IFRS S1 compliance without altering existing standards
• Exposure draft slated for public comment in October
• Uses TNFD framework to shape disclosure requirements
• Provides pathway toward future mandatory nature‑related standard

Pulse Analysis

The International Sustainability Standards Board (ISSB) used its Earth Day meeting to unveil plans for an IFRS Practice Statement that will clarify how companies should disclose nature‑related risks and opportunities. By positioning the practice statement alongside IFRS S1 (general sustainability disclosure) and IFRS S2 (climate‑related disclosure), the ISSB avoids amending existing standards while still delivering actionable guidance. This approach is designed to limit disruption for firms already navigating the complex rollout of ISSB requirements across multiple jurisdictions.

The forthcoming practice statement leans heavily on the Taskforce on Nature‑related Financial Disclosures (TNFD) framework, which provides a globally recognised taxonomy for nature‑related metrics. An exposure draft is scheduled for October, giving stakeholders a chance to comment on the proposed language and on whether a practice statement is the optimal vehicle. The ISSB’s decision reflects a broader regulatory backdrop where the United States has stalled on new climate reporting rules and the European Union has narrowed the scope of its sustainability reporting mandates, leaving a vacuum that the ISSB hopes to fill with consistent, high‑quality guidance.

If adopted, the practice statement will carry the same force as an ISSB standard for companies that elect to apply it, creating a de‑facto pathway toward a future, more prescriptive nature‑related standard. Investors and lenders are increasingly demanding granular environmental data, and a unified disclosure regime could lower compliance costs while improving comparability. Ultimately, the ISSB’s move signals a push for global coordination in sustainability reporting, positioning nature‑related metrics as a core component of corporate risk management and capital allocation decisions.