What are IFRS S1 and S2, and why are they important?

IFRS S1 and S2 provide a global framework for sustainability reporting. IFRS S1 covers sustainability-related risks and opportunities, while IFRS S2 focuses on climate-related disclosures, including Scope 1, 2, and 3 GHG emissions. These standards aim to give investors consistent and reliable information, linking sustainability performance to financial value.

Are IFRS S1 and S2 mandatory for companies?

In Malaysia, a phased rollout is set to begin on 1 January 2025, starting with large Main Market-listed companies. Over the following years, it will expand to include other listed entities and major private companies. Businesses should stay vigilant and closely monitor local regulations to maintain compliance.

How do IFRS S1 and S2 differ from other sustainability reporting frameworks?

IFRS S1 and S2 focus on providing investors and capital markets with clear sustainability and climate-related financial information. By integrating elements from TCFD and SASB, they create a unified global standard that highlights the financial impact of sustainability issues, simplifying the reporting process.

What steps should companies take to comply with IFRS S1 and S2?

To ensure effective compliance with new IFRS requirements, companies should conduct a gap analysis, build systems to manage sustainability data, and invest in training to equip teams with the expertise needed for accurate reporting.

Business Guides in Malaysia

IFRS Sustainability Standards Malaysia: A Guide for Businesses

IFRS Sustainability Standards Malaysia marks a significant paradigm shift in corporate transparency, driven by global climate commitments and increasing investor demand for clarity on environmental, social, and governance (ESG) performance....

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Business Guides in Malaysia

IFRS Sustainability Standards Malaysia: A Guide for Businesses

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