Objective

IFRS S1 requires entities to disclose sustainability-related risks and opportunities that could reasonably be expected to affect cash flows, access to finance, or cost of capital over the short, medium and long term. The objective is to provide decision-useful information to primary users of general purpose financial reports.

Scope

The Standard applies to sustainability-related financial disclosures prepared in accordance with IFRS Sustainability Disclosure Standards, regardless of the accounting framework used for financial statements. Risks and opportunities not expected to affect an entity’s prospects are outside scope.

Conceptual foundations

Useful sustainability-related financial information must be relevant and faithfully represent the entity’s risks and opportunities. Comparability, verifiability, timeliness and understandability enhance usefulness. Materiality is assessed in the context of the entity’s sustainability-related financial disclosures as a whole.

Fair presentation

Entities must provide a complete, neutral and accurate depiction of material sustainability-related risks and opportunities. Additional disclosures are required where specific standards alone do not sufficiently explain effects on financial prospects.

Materiality

Information is material if its omission, misstatement or obscuring could reasonably be expected to influence decisions of investors, lenders or other creditors. Materiality assessments must consider quantitative and qualitative factors and be reassessed at each reporting date.

Reporting entity

Sustainability-related financial disclosures must relate to the same reporting entity as the associated financial statements, ensuring consistency across general purpose financial reports.

Connected information

Entities must explain connections between sustainability-related risks and opportunities and between governance, strategy, risk management, and metrics and targets. Disclosures should also be connected with related financial statements using consistent data and assumptions.

Core content

Entities must disclose information across governance, strategy, risk management, and metrics and targets, unless another IFRS Sustainability Disclosure Standard specifies otherwise.

Governance

Disclosures must describe governance bodies or individuals overseeing sustainability-related risks and opportunities, including responsibilities, competencies, information flows, oversight of strategy and targets, and links to remuneration. Management’s role and supporting controls must also be explained.

Strategy

Entities must disclose material sustainability-related risks and opportunities, their time horizons, and impacts on the business model and value chain. Current and anticipated effects on financial position, performance and cash flows must be explained, including the resilience of strategy. Quantitative information is required where reasonably supportable; otherwise, qualitative explanations are required.

Risk management

Entities must describe processes used to identify, assess, prioritise and monitor sustainability-related risks and opportunities, including inputs, use of scenario analysis, prioritisation relative to other risks, and integration with overall risk management.

Metrics and targets

For each material risk and opportunity, entities must disclose relevant metrics and targets, including definitions, calculation methods, assumptions, validation, baselines, timeframes, progress and revisions.

General requirements

Sources of guidance

Entities must apply IFRS Sustainability Disclosure Standards and consider SASB Standards and other relevant guidance where no specific standard applies.

Location of disclosures

Sustainability-related financial disclosures must form part of general purpose financial reports and be clearly identifiable, including where cross-referenced.

Timing of reporting

Disclosures must cover the same reporting period and be published at the same time as financial statements, with updates for material subsequent events.

Comparative information

Comparative information is required for prior periods unless transition relief applies, with explanations for changes in metrics or estimates.

Statement of compliance

Entities complying with all IFRS Sustainability Disclosure Standards must make an explicit and unreserved statement of compliance.

Judgements, uncertainties and errors

Judgements

Entities must disclose significant judgements made in identifying risks and opportunities, determining materiality, and selecting sources of guidance.

Measurement uncertainty

Significant uncertainties affecting reported amounts must be disclosed, including sources of uncertainty and key assumptions.

Errors

Material prior-period errors must be corrected through restatement where practicable, with disclosures explaining the nature and correction of errors.