The Ultimate Guide to ISSB Reporting: IFRS S1 & S2 Compliance Made Simple (2025 Edition)

Stay ahead of sustainability disclosure mandates. neoeco transforms ISSB reporting into a finance-led advantage, from materiality to audit-ready reports.

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Overview of ISSB, IFRS S1 & S2

What is ISSB Reporting?

ISSB reporting refers to sustainability disclosures aligned with the International Sustainability Standards Board (ISSB) — the global framework created to bring consistency, clarity, and financial relevance to climate and ESG reporting.

The ISSB, under the IFRS Foundation, launched IFRS S1 and IFRS S2 in 2023. These standards mark the world's first truly global baseline for sustainability-related financial disclosures. As of 2025, jurisdictions across the globe are adopting or aligning with these standards, making ISSB reporting a defining requirement for finance and sustainability teams alike.

Financially Material Focus

IFRS S1 & S2 Standards

TCFD-Aligned

Disclose in Financial Reports

Why ISSB Reporting Matters Now

ISSB has already been endorsed by IOSCO, the global body of securities regulators, and is seen as the new benchmark for capital market disclosures. It matters because:

Investors are demanding comparability across jurisdictions and industries.

Regulators are embedding ISSB into law, e.g., via UK SRS and CSRD interoperability

Firms want to avoid duplication with fragmented voluntary ESG frameworks

According to the IFRS Foundation's 2024 Jurisdictional Guide, global adoption is accelerating — with phased implementation and capacity-building underway in the UK, Australia, Japan, and Canada.

Key Components of ISSB Reporting

ISSB reporting is structured to bring clarity and consistency to sustainability disclosures by focusing on two core standards: IFRS S1 & S2.

These standards define what companies must report on to meet investor expectations around sustainability risks and opportunities. IFRS S1 provides a framework for disclosing general sustainability-related financial information, while IFRS S2 focuses specifically on climate-related disclosures.

Together, they form the foundation of ISSB’s global baseline, designed to integrate seamlessly with financial reporting and ensure decision-useful, comparable data across markets and industries.

IFRS S1: General Sustainability-related Financial Disclosures

IFRS S2: Climate-related Disclosures

What it’s for

Establishing a global framework for sustainability-related disclosures across industries

Providing detailed climate-related disclosures that help investors understand climate risks and opportunities

Who it applies to

Any company preparing general-purpose financial reports

Companies with material climate-related financial risks and opportunities

Core requirements

– Governance
– Strategy
– Risk management
– Metrics and targets

– Climate-related governance and strategy
– Scenario analysis
– Emissions disclosures (Scopes 1, 2, and 3)
– Climate risk integration
– Metrics and targets

Who Needs to Report?

ISSB reporting is primarily aimed at publicly accountable entities, such as listed companies, banks, and insurers — especially those operating in global capital markets. However, the scope is expanding rapidly as jurisdictions formalise their adoption plans. According to the IFRS Foundation's 2024 Jurisdictional Guide, countries including the UK, Canada, Australia, Japan, Nigeria, Brazil, and Singapore have already committed to adopting ISSB standards or are introducing functionally aligned sustainability disclosure requirements into law.

The UK's Sustainability Disclosure Standards (SDS), based on IFRS S1 and S2, are expected to become mandatory in 2025, with similar timelines across multiple G20 markets.

Most jurisdictions are targeting fiscal years beginning in 2025 or 2026, often with transition reliefs in the first year — such as climate-only disclosures and deferral of Scope 3 emissions. These timelines mean companies preparing now will be first-movers in regulatory readiness, investor trust, and strategic reporting maturity.

The UK's Sustainability Disclosure Standards (SDS), based on IFRS S1 and S2, are expected to become mandatory in 2025, with similar timelines across multiple G20 markets.

How to Prepare

To prepare for ISSB reporting, CFOs, CSOs, and sustainability leaders should begin laying the foundation now. The shift to IFRS S1 and S2 standards requires more than a disclosure checklist — it demands cross-functional alignment, robust data systems, and board-level oversight. Whether reporting becomes mandatory in your jurisdiction in 2025 or 2026, taking these early steps will ensure your organisation is audit-ready, investor-aligned, and ahead of the regulatory curve.

Assess your current disclosures against IFRS S1 and S2.

Map data sources - especially for Scope 3 emissions

Build a cross-functional team involving finance, ESG, risk, and ops.

Plan early for assurance and audit-readiness.

Download your free ISSB checklist

Finance leaders, sustainability teams, and strategic operators navigating ISSB, CSRD, and the capital implications of ESG. If you're building sustainability reporting that holds up to audit and drives value — this is your playbook.