Insurance Europe said it supports initiatives in Europe aimed at embedding environmental, social and governance (ESG) criteria into all aspects of business and individual behaviour
Insurance Europe has published its response
to a consultation by the International Financial Reporting Standards
(IFRS) Foundation on an exposure draft that outlines proposed amendments
to the foundation’s constitution to accommodate an International
Sustainability Standards Board (ISSB).
Insurers also recognise the need for international
action and solutions to what are global issues. In light of this,
Insurance Europe generally agrees with the proposals made by the IFRS
trustees in their proposed targeted amendments:
- Insurers support having a board structure for the ISSB inspired by what currently exists at the IASB for financial reporting.
- Insurers
support the ISSB objective of promoting the convergence of national and
regional sustainability reporting standards and IFRS sustainability
reporting standards.
- Insurers welcome the fact that the IFRS Foundation intends to collaborate with regional initiatives – this is key.
Insurance Europe also had the following comments:
- The
ISSB’s work should also cover the impact of the company on its
environment, as well as the impact of ESG factors on the company value
(ie double materiality).
- Sustainability standards should include forward-looking, transition information and include qualitative elements.
- The IFRS work should set its scope to encompass all aspects of sustainability, not only climate.
- Particular
attention should be given to companies’ strain on reporting. In
particular, the cost of producing data and the sensitivity of certain
information that could affect the competitiveness of companies must be
carefully considered throughout the process in a proper manner.
- While
insurers support the flexibility given to the ISSB in the constitution
on field testing, performing field tests should be considered as a norm
rather than an exception if considerable concerns exist or emerge
relating to particular standards.
- Board members of the ISSB
should not be chosen using only geographical criteria. To ensure that
the future standards will fit the needs of all jurisdictions and be
applied by all countries across the world, the composition of the Board
should also reflect the variety of profiles involved in sustainability
reporting processes including investors, preparers and civil society.
Insurance Europe
© InsuranceEurope
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