Skip to content
  • MyNewMarkets.com
  • Claims Journal
  • Insurance Journal TV
  • Academy of Insurance
  • Carrier Management
Insurance Journal - Property Casualty Industry News

Featured Stories

  • Lengthy Government Shutdown to Impact Insurers
  • FEMA, Customs and Border Protection Staff Data Stolen
  • Articles
  • Jobs
  • Markets

Current Magazine

current magazine
  • Read Online
  • Subscribe
  • Login
  • Front Page
    • National
    • International
    • Most Popular
    • Magazine
    • Forums
    • Blogs
    • Videos/Podcasts
    • Newsletters
  • News
    • Most Popular
    • National
    • International
    • East
    • Midwest
    • South Central
    • Southeast
    • West
  • Magazines
  • Research
  • Directories
  • Jobs
  • Features
    • Events
    • Forums
    • Market Directories
    • Quotes
    • Polls
    • Rankings & Awards
    • Insurance Giving Back
  • Subscribe

New Sustainability Rules Attacked for Protecting Profits Over Planet

By Frances Schwartzkopff and Lisa Pham | July 29, 2022
Email This Subscribe to Newsletter
  • Article

The organization aiming to set worldwide climate reporting requirements for decades to come is under fire for putting corporate interests ahead of the planet’s.

In coming months, the International Sustainability Standards Board will publish rules for companies to disclose the growing financial risks they face from climate change, environmental degradation and social inequality. This rulebook is poised to become the leading global standard for sustainability reporting, eventually used by asset managers, lenders and insurers to drive trillions of dollars in green investments.

The ISSB has authority because its founding parent, the IFRS Foundation, developed the financial reporting standards now used in more than 140 countries. The ISSB process was sped up in response to the urgency of the climate crisis and demand for information about environmental, social and governance issues.

But sustainability advocates and accountants say the ISSB’s proposals currently fall short of what’s needed to protect the environment.

One contentious issue is that while the ISSB’s proposals require companies to disclose material impact of outside ESG risks on their business, they don’t explicitly require companies to provide detailed disclosures about the impact of their operations on the environment and society. This seemingly arcane but salient idea of “double materiality” has, for example, been adopted by the EU in its disclosure rules. The idea is to give investors a clearer view of overall corporate impact.

That gap in ISSB’s proposals “is of grave concern to me,” said Celine Bak, who served on the technical working group of the Climate Disclosure Standards Board, later incorporated into ISSB. “It’s creating an extremely dangerous precedent that the social and environmental issues only matter insofar as they affect profitability, and that will have reverberating effects.”

Andrew Steel, global head of Sustainable Fitch, agrees that the risk should be measured both ways—societal impact on a company, as well as company impact on society. “”Often these aspects are interlinked, and therefore to consider them from a single perspective potentially underestimates the negative or positive impact,” Steel wrote in an email.

ISSB is receiving comments on its proposals through Fridayand plans to complete the standards by the end of the year, depending on the feedback.

“It’s not that the IFRS thinks that double materiality isn’t important,” said a spokesman for the IFRS Foundation. The ISSB said it has already received more than 800 comment letters on its proposals. In coming months, its board plans to review the submissions and address issues, such as double materiality, raised in those letters.

ISSB says its reporting standards are intended to focus on environmental and social issues that may affect a company’s value, so investors can make better informed decisions about where to put their money. The standards are voluntary, though most countries are expected to adopt them, as they have IFRS. Some countries may impose their own, tougher requirements.

To strengthen its position, the ISSB organization recently struck an agreement with the Global Reporting Initiative, whose standards for reporting corporate impact are the most used around the world.

“GRI is about non-financial materiality, we are about financial materiality,” said Emmanuel Faber, ISSB chair and former CEO of food company Danone SA, in an interview. “We are bringing a suite… of solutions for companies to report against the full materiality spectrum.”

Some observers also criticize the ISSB proposals because they don’t require companies to chart a clear path to keeping global temperatures increases to 1.5 degrees Celsius, in line with warnings issued by the Intergovernmental Panel on Climate Change.

Companies should be encouraged to “align their plans and objectives to this target by adopting clear timescales and milestones,” said Laurent Babikian, joint global director of capital markets at CDP, a nonprofit that runs a global disclosure system, in an email.

The IFRS says that goes beyond its remit. “It’s not the place of the IFRS to say to an individual jurisdiction: ‘You must have this climate goal,'” the IFRS spokesman said.

The ISSB organization was created last year following demands by ESG investors frustrated by wide variations in corporate reports and the multiplicity of disclosure frameworks. ISSB board members include prominent experts in accounting and sustainability, including former BlackRock Inc. director of ESG integration Verity Chegar.

The ISBB proposals are based on existing reporting guidelines from the Task Force on Climate-related Financial Disclosures and the Sustainability Accounting Standards Board (which has since been consolidated into ISSB.) TCFD is chaired by Michael Bloomberg, the founder of Bloomberg News parent Bloomberg LP.

Photo: Emmanuel Faber. Photographer: Christopher Goodney/Bloomberg

Copyright 2025 Bloomberg.

Topics Profit Loss

Was this article valuable?

Thank you! Please tell us what we can do to improve this article.

Thank you! % of people found this article valuable. Please tell us what you liked about it.

Here are more articles you may enjoy.

IBHS Study Shows Smaller Hail May Be More Damaging to Roofs Than Once Believed
Gallagher Sues Two Former Brokers Who Started Own Firm
Hedge Funds Targeting Fire Insurance Hit a Wall in California
Former Adjuster Charged With Creating Then Approving $190K in Fraudulent Claims

Written By Frances Schwartzkopff

More From Author

Interested in Profit Loss?

Get automatic alerts for this topic.

Email This Subscribe to Newsletter
  • Categories: International & Reinsurance NewsTopics: Climate Change, climate reporting, Environmental, environmental social and governance (ESG) criteria, social inequity
  • Have a hot lead? Email us at newsdesk@insurancejournal.com
More News
Walmart Sued for Disability Discrimination at Wisconsin Location
Exxon Delays Planned Plastic Plant on Texas Coast
Cost of Citadel’s Planned Miami Tower Surges to $2.5 Billion
SC Law Enforcement Says No Arson Evidence in Fire That Destroyed Judge’s Home
More News Features

Read This Next

  • New Sustainability Rules Attacked for Protecting Profits Over Planet
  • Connecticut Settles But Wrongful Death Suit Over Murder of Visiting Nurse Goes On
  • Lengthy Government Shutdown to Impact Insurers, Says AM Best
  • Wildfire Smoke Set to Cause Mounting Deaths and Economic Losses
  • Update: National Flood Insurance Program Expires

Insurance Jobs

  • Customer Service Agent – Personal Lines - Bethlehem, PA
  • Claims Manager, Insurance & Risk Management - Queens, New York
  • Senior Insurance Agent (3+ Yrs P&C Exp | W-2 | Warm Leads | In-Office Only) Senior Insurance Agent (3+ Yrs P&C Exp | W-2 | Warm Leads | In-Office Only) - Westminster, CO
  • Data Scientist – Marketing Analytics - Illinois, IL
  • Construction Commercial Underwriter, Account Executive - Overland Park, KS
MyNewMarkets
  • How to Attract the Next Generation to Insurance
  • 5 Evolving Trends Shaping Architects and Engineers Coverage
  • Rethinking Assault & Battery Liability in Commercial Real Estate
  • From Golf Greens to Sausage Fests: The Wild World of Prize Insurance
  • As Schools Prepare to Pay Athletes, What Role Will Insurance Play?
Claims Journal
  • GM Backtracking on Plan to Claim Last-Minute EV Tax Credits
  • Ransomware Gang Qilin Claims Hack That Hit Beermaker Asahi
  • Tesla Unveils Lower-Cost Models in Drive to Reignite Sales
  • Expert: Inflation Continues to Sew Uncertainty in Auto and Auto Repair
  • Negotiation Is the Job: Reframing Defense Work in an AI-Enhanced Era
Academy of Insurance education
  • October 9 Forward Into The Past: Certificates of Insurance, Additional Insureds, and Other Contractual Risk Transfer Issues
  • October 16 Auto Insurance: You Get What You Pay For
  • October 23 Gotchas That'll Getchya - Latest Policy Language That'll Get You Sued
  • October 30 Challenges in Agency Mergers – Reducing Staff Flight and Avoiding E&O Claims

Insurance News

  • News by Region
  • News by Topic
  • Yesterday

Site Search

Features

  • Insurance Markets Directory
  • Forums
  • A.M. Best Company Ratings
  • Industry Events
  • Agencies For Sale
  • Newswire
  • Insurance Jobs
  • Rankings & Awards

Connect with us

  • Email Newsletters
  • Magazine Subscriptions
  • For Your Website
  • RSS Feeds
  • Twitter
  • Facebook
  • LinkedIn
  • Do Not Sell My Info

Insurance Journal

  • Submit News
  • Advertise
  • Subscribe
  • Reprints
  • Link to Us
  • Contact Us

Wells Media Group Network

  • Insurance Journal
  • MyNewMarkets.com
  • Claims Journal
  • Insurance Journal TV
  • Academy of Insurance
  • Carrier Management
© 2025 by Wells Media Group, Inc. Privacy Policy | Terms & Conditions | Site Map