The International Organization of Securities Commissions (IOSCO) has published a report considering how transition plan disclosures can support investor protection and market objectives. Developed by IOSCO’s Sustainable Finance Taskforce (STF), the report outlined coordinated actions for securities regulators, including ensuring consistency and comparability through transition plan guidance, promoting assurance of disclosures, enhancing legal and regulatory clarity and oversight, and building capacity. The report also identified the most useful components of transition plan disclosures suggested by market participants: ambition and targets; decarbonisation levers and action plan; governance and oversight; financial resources and human capital; and financial implications. “Comparable, consistent and reliable disclosures may have a positive effect on market participants’ ability to make informed decisions, ultimately benefiting both investors and the integrity of the capital markets,” said Rodrigo Buenaventura, Chair of IOSCO’s STF. “High-quality transition plans are key to navigate the transition towards lower greenhouse gas emissions, a climate-resilient global economy and are relevant to all jurisdictions, entities and investors.” IOSCO intends to continue its engagement with key stakeholders, including the IFRS Foundation and its International Sustainability Standards Board (ISSB), while promoting market integrity and mitigating greenwashing risks with regards to transition plans. “Climate transition plans are becoming increasingly used by companies,” said Jean-Paul Servais, Chair of IOSCO’s Board. “IOSCO also welcomes the ISSB’s announcement on developing educational materials in this area and invites them to continue their efforts with regards to alignment of standards and guidance. We will continue to engage with the ISSB in this process.”
