The International Public Sector Accounting Standards Board (IPSASB), with support from the World Bank, is developing a climate-related disclosures standard for the public sector.
The IPSASB, developer of international reporting standards for use by governments and other public sector entities around the world, announced in June 2023 it would begin developing a Climate-related Disclosures standard, a first for the public sector. This standard will be the IPSASB’s inaugural Sustainability Reporting Standard (IPSASB SRS™). By increasing transparency, it will enable governments and other public sector entities to make more informed decisions about their contributions towards addressing the climate emergency, hold them accountable for their interventions, and foster trust in their efforts.
The World Bank, an institution dedicated to providing financing, policy advice, and technical assistance to governments of developing countries, has put their support behind this critical initiative to develop the IPSASB's first SRS on Climate-related Disclosures. An initial draft standard will be released for feedback in Q4 2024.
Alongside this announcement, the IPSASB has also published a Stakeholder Engagement Plan outlining how people can provide feedback about the project, through mechanisms that are already a central part of the IPSASB’s due process.
“Equipping governments with the quality standards necessary to report on their critical contributions to addressing the climate emergency together with other sustainability issues requires global support,” said Ian Carruthers, IPSASB Chair. “The World Bank’s contribution provides welcome support for our initiative to develop urgently-needed public sector specific sustainability reporting standards, beginning with a Climate-related Disclosures standard.”
“The standard will take climate reporting to a new level and will complement the reporting requirements of the Paris Agreement which come into effect this year,” said Arturo Herrera, World Bank Global Director for Governance. “Many countries lack a way to track and assess progress against their climate-related commitments, and to identify and disclose risks and impacts. This is especially true for developing countries, many of which are among the most at-risk from climate change. At the same time, SRS disclosure can help attract new investment from the private sector. Some of the world’s biggest investors look at ESG performance in deciding where to invest. The new standard will provide that information.”
Global community engagement is essential to developing sustainability reporting standards for the public sector. The IPSASB continues to seek support for its sustainability reporting standards development program and requires additional resources to scale up its efforts and move with pace. To contribute financial or other support to the IPSASB for the development of IPSASB SRS, please email Ross Smith, IPSASB Program and Technical Director (rosssmith@ipsasb.org).
About the IPSASB
The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, the government of Canada, and the World Bank. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.
The World Bank is an international organization that provides financing, advice, and research to developing nations to help advance their economies. It is one of the world’s largest sources of funding and knowledge for developing countries. The World Bank is headquartered in Washington, D.C. and is affiliated with the United Nations. It is made up of five institutions with one common mission: to end extreme poverty and boost shared prosperity on a livable planet.
Funding for the project is through the World Bank’s Financial Management Umbrella Program. The Program is supported by the Australian Department of Foreign Affairs and Trade, the Government of Austria, the Bill & Melinda Gates Foundation, the European Union, the Swedish International Development Cooperation Agency, Switzerland’s State Secretariat for Economic Affairs, the United Kingdom’s Foreign, Commonwealth and Development Office, and the United States Agency for International Development.
The IPSASB’s first Sustainability Reporting Standard, Climate-related Disclosures, is now in development
Unleashing the Potential of Islamic Finance: Global Perspectives on Achieving the SDGs with Islamic Finance Tools & Concepts, a new report from the International Federation of Accountants, Malaysian Institute of Accountants (MIA) and the World Bank Group Inclusive Growth and Sustainable Finance Hub in Malaysia (World Bank) looks at the opportunities presented by Islamic finance, practical examples of its usage from Malaysia, and future pathways towards addressing challenges and unlocking the full potential of Islamic finance to support the SDGs.
The report was released today at Innovation in Sustainable Development: Islamic Finance Paving the Way hosted by MIA in Kuala Lumpur featuring a keynote address from IFAC President Asmâa Resmouki.
In recent years, addressing the Sustainable Development Goals (SDGs) has become increasingly challenging. The worldwide economic downturn resulting from the COVID-19 pandemic has worsened the already significant USD4.2 trillion funding gap to achieve the SDGs. As countries worldwide strive to finance the ambitious scope and scale of the SDGs, they also face the complex task of serving financially underserved communities. Advancing Islamic finance has the potential not only to serve usually underbanked Muslim communities but has broader application considering its synergies with the SDGs.
A major tenet of Islamic finance is the protection of people, planet, and prosperity, and its underpinnings can contribute to fresh thinking on sustainable development paradigms, interpretations, and approaches. The SDGs create opportunities for Islamic finance growth, just as Islamic finance can drive greater sustainable development.
Malaysia has become a pioneer of Islamic finance, attributed in part to its strong governance, supportive regulatory ecosystem, and the pivotal role of a local professional accountancy organization, MIA, in education and stakeholder outreach. Though every jurisdiction’s use of Islamic finance would work differently, Malaysia and MIA can serve as examples to learn from.
“Professional accountancy organizations are playing a key role in advancing sustainable financing, and given the profession’s commitment to support the SDGs, principles of Islamic finance should be considered a viable approach,” said Asmâa Resmouki, IFAC President. “We encourage all IFAC members to look towards best practices such as those cultivated in Malaysia, and seize opportunities presented in their own jurisdictions.”
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in more than 135 jurisdictions, representing millions of professional accountants in public practice, education, government service, industry, and commerce.
Key considerations for professional accountants and purchasers on the carbon credit life cycle
This is the first part of a series to help professional accountants, investors, regulators and policymakers enhance their understanding of carbon markets as a potentially important part of the infrastructure needed to support climate action.
