The International Sustainability Standards Board (ISSB) is the global standard-setter for investor-focused sustainability disclosure, operating under the IFRS Foundation. Its first two standards — IFRS S1 for general sustainability-related financial disclosures and IFRS S2 for climate — give capital markets a common baseline that individual jurisdictions adopt into their own reporting rules.
Why It Matters for Manufacturers
ISSB standards use financial materiality: what matters is how sustainability issues affect enterprise value, not the company’s impact on the world. That makes them narrower than CSRD but no lighter on data.
IFRS S2 requires disclosure of Scope 1, 2 and 3 emissions calculated to GHG Protocol standards and carries forward the TCFD architecture of governance, strategy, risk management, and metrics and targets.
For multinational manufacturers, ISSB is becoming the connective tissue between regimes: a single Protocol-aligned emissions inventory can feed IFRS S2, CSRD and California reporting rather than three separate exercises.
U.S. and EU Applicability
Neither the U.S. nor the EU has adopted ISSB standards directly, but both connect to them. The EU’s ESRS are designed for climate interoperability with IFRS S2. In the U.S. there is no federal adoption, though investor expectations increasingly reference the standards. The UK has published its Sustainability Reporting Standards, built directly on IFRS S1 and S2, which makes ISSB the entry point for understanding UK reporting obligations.
Current Status
Last updated: July 12, 2026
- The ISSB has assumed responsibility for monitoring climate disclosure progress from the TCFD, which has disbanded; TCFD-aligned reporting now points to IFRS S2.
- The final UK Sustainability Reporting Standards, based on IFRS S1 and S2, were published Feb. 25, 2026, and are available for voluntary use. The FCA has proposed requiring listed companies to make climate disclosures under UK SRS S2 from Jan. 1, 2027, with final rules expected in autumn 2026.