Statement from Michael R. Bloomberg (Co-Chair of GFANZ and UN Secretary-General’s Special Envoy on Climate Ambition and Solutions), Mark Carney (Co-Chair of GFANZ and UN Secretary-General’s Special Envoy on Climate Action and Finance), and Mary L. Schapiro (Vice Chair of GFANZ and Head of the Secretariat for the Task Force on Climate-related Financial Disclosures)

The IFRS Foundation’s decision to begin work to support the disclosure of firms’ transition plans under IFRS S2 is a welcome step forward.

This will build on the Glasgow Financial Alliance for Net Zero’s transition plan framework, which was published in 2022 to help financial institutions and the businesses they fund fulfill the recommendations of the Taskforce on Climate-Related Financial Disclosures.

GFANZ is helping mainstream transition planning globally. Its framework has been drawn on by the UK’s Transition Plan Taskforce, the U.S. Treasury’s Principles for Net-Zero Financing & Investment, as well as guidance published by regulators and policymakers in Japan, Singapore, and Hong Kong.

The ISSB will now take forward the aspect relevant to their work, helping to create global consistency in the information provided about transition plans and sending a strong signal to authorities, financial institutions, and companies on the nature of future expectations about these disclosures.

This comes not a moment too soon given the significant increase in voluntary transition planning within the private sector and increased interest from national regulators globally.

There is strong demand for a common global approach and as momentum builds, GFANZ expects more than 250 transition plans to be published by major financial institutions this year. These transition plans will be most useful to decision-makers when reported in a consistent and comparable way across markets.

The G20 should now mandate transition plans for large companies and financial institutions to help turn commitments into action and unlock the capital needed to decarbonise the economy.