IFRS S2: Pillar I – : TCFD Recommendations vs. IFRS S2 Requirements
IFRS S2: Pillar I – : TCFD Recommendations vs. IFRS S2 Requirements
IFRS S2: Pillar I – : TCFD Recommendations vs. IFRS S2 Requirements
common financial reporting framework that ensures transparency, consistency, and accountability
across the global financial landscape. As sustainability and environmental, social, and governance (ESG)
factors continue to gain prominence in corporate reporting, IFRS S2 has emerged as a pivotal standard
designed to guide companies in disclosing climate-related financial information. Among the key
components of this new standard, Pillar 1 — Governance — stands at the forefront, emphasizing the
importance of robust governance structures in driving climate-related risk management and sustainable
practices.
Pillar 1 of IFRS S2 focuses on the governance mechanisms that organisations must put in place to
oversee and integrate climate-related matters into their operations. This pillar underlines the need for
clear accountability, effective board oversight, and the allocation of roles and responsibilities at all
levels of the organisation to ensure that climate-related risks and opportunities are properly
addressed. As businesses navigate the evolving landscape of climate disclosures, a strong governance
framework is not only vital for compliance but is also critical for fostering long-term resilience and
value creation.
This article explores the key principles and requirements under Pillar 1 of IFRS S2, offering insights into
how organisations can establish and maintain effective governance structures that support their
climate-related objectives.