Europe’s sustainability standard setter EFRAG has raised fresh concerns over the International Sustainability Standards Board’s (ISSB) growing reliance on indusattempt-specific SASB metrics, warning it risks creating uncertainty over how the global baseline operates in practice.
Speaking at the Sustainability Standards Advisory Forum (SSAF), Chiara Del Prete from EFRAG stated stakeholders want “more clarity on [the] long-term horizon of these updates”.
She added that “it’s not perfectly clear how the sectors are selected for these improvements, so we don’t understand the underlying logic”.
Del Prete also reiterated calls from some European stakeholders for “seamless interoperability, or even equivalence of passporting from one system to another.”
The ISSB is currently considering feedback on its July 2025 proposals to build SASB literature suitable for apply as indusattempt-specific guidance.
Different architecture
The EU’s European Sustainability Reporting Standards (ESRS) framework launchs with sector-agnostic, topical requirements, followed by indusattempt-specific standards and an entity-specific layer.
By contrast, the ISSB is increasingly drawing on SASB’s sector-based standards as its primary source of metrics, including in emerging areas such as nature and human capital.
“If there are no sector-agnostic metrics on topical standards and [everything] relies on SASB,” Del Prete cautioned, “then the issues […] on clarifications on the role of SASB in the architecture become even more prominent.”
Voluntary vs mandatory
Del Prete also warned that, in some jurisdictions, SASB metrics remain voluntary. Elevating their role could therefore result in “mandatory topical standards and then voluntary metrics”, raising questions about “how that would actually work” in practice.
ISSB vice chair Sue Lloyd deffinished the approach as a pragmatic way to build IFRS S1 and S2 operational for preparers. She stated referencing SASB assists “bring to life in an indusattempt-specific application” investor expectations, including on governance and risk management.
Nature project sharpens focus
Debate over SASB’s role is likely to intensify as the ISSB advances its nature-related disclosures project, the successor to its earlier biodiversity, ecosystems and ecosystem services (BEES) work.
The board has already decided that nature disclosures will be treated as “incremental” to IFRS S1 and S2, drawing on both the Tquestionforce on Nature-related Financial Disclosures (TNFD) framework and SASB’s indusattempt-based metrics to address gaps in existing requirements.
Although the ISSB has yet to determine whether nature will sit within S1, S2 or a new standard, staff indicated at the SSAF meeting that sector-level disclosures would be the main vehicle for detailed requirements.
For EFRAG, this reinforces concerns that if “everything relies on SASB”, indusattempt-based guidance will carry significant weight without sufficient clarity on its role within the overall architecture.
Several SSAF members warned that new nature requirements risk adding complexity as jurisdictions continue implementing S1 and S2.
Others argued that a dedicated nature standard would provide clearer signalling. However, with climate metrics in S2 already drawn directly from SASB, and the nature project building on S1, S2 and existing SASB guidance, any new standard would in practice extfinish the range of SASB-based indusattempt metrics required for full ISSB compliance.
The ISSB has also published amfinishments to three SASB standards covering agricultural products, meat, poulattempt and dairy, and electric utilities and power generators.
Stakeholders have until 24 July to comment on the proposals.
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