ISSB Proposes Nature-Related Disclosure Requirements for Companies
The ISSB has published its nature-related disclosures draft as a non-mandatory Practice Statement, with comments due by February 19, 2027.
The International Sustainability Standards Board published an exposure draft of its nature-related disclosures proposals on October 22, 2026, opening a 120-day consultation that closes on February 19, 2027.
The IFRS Foundation released the ISSB nature-related disclosures draft alongside a Basis for Conclusions, accompanying guidance and a summary. It is an IFRS Practice Statement, not a standard. Companies would not have to follow it to state that they comply with the ISSB’s standards.
For finance teams the form matters as much as the content. IFRS S1 already requires disclosure of material information on all sustainability-related risks and opportunities, nature included. The draft shows how to do that consistently, and it leaves any mandate to the jurisdictions that choose to apply it.
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What the ISSB nature-related disclosures draft requires
The draft is written like a standard. The Foundation said the content and drafting match those of a standard, and the proposals went through full due process, including public consultation.
Companies would explain what nature-related risks and opportunities are, how they can affect their prospects, and which information is useful to investors. They would report how they have responded, and plan to respond, in strategy and decision-making. They would also report how resilient their strategy and business model are to uncertainty arising from nature.
The draft asks for the amount and percentage of assets or business activities vulnerable to nature-related risks, and of those aligned with nature-related opportunities. Companies would also describe their nature-related targets: what each target covers, its location-specific aspects and objectives, and whether law or regulation informed it.
The proposals stress location and interactions with Indigenous Peoples, local communities and other affected stakeholders. They are designed to connect nature with climate and financial statement information rather than create a separate silo.
A Practice Statement, not a mandatory standard
The ISSB decided in April 2026 to proceed with a Practice Statement rather than a standalone mandatory standard. It said the format limits disruption for companies still implementing IFRS S1 and IFRS S2, the first standards, issued in June 2023.
The consultation also asks whether the content should be finalised as a Practice Statement or issued in another form, such as a standard. That question is open, and respondents can argue for a mandatory instrument.
Sue Lloyd, ISSB Vice-Chair, framed the trade-off.
“We recognise that companies are deeply engaged with applying IFRS S1 and IFRS S2 for the first time. What we’re proposing is to balance the need to give markets time to implement the ISSB Standards well, with the demand from investors for information on nature.”
Sue Lloyd, Vice-Chair, International Sustainability Standards Board
ISSB Chair Emmanuel Faber tied the proposals to operating risk. Companies depend on nature, he said, “whether it is access to water for production, to rivers for transportation or to bees for pollination”.
The ISSB said companies that comply with an IFRS Sustainability Practice Statement on nature-related disclosures will be best placed to give investors high-quality reporting.
How the draft draws on the TNFD framework
The ISSB said it drew extensively on the Taskforce on Nature-related Financial Disclosures (TNFD) framework, and that companies already using it are well positioned to apply the Practice Statement. The TNFD ended its own technical work programme after the ISSB announced its plans.
David Craig, TNFD Co-Chair, welcomed the draft. He said it “draws extensively on the TNFD’s framework” and that the TNFD will support the ISSB as it finalises the proposals.
The ISSB also said companies applying the Global Reporting Initiative standards or the European Sustainability Reporting Standards alongside the Practice Statement should be able to do so efficiently. A group that reports under ESRS for Europe and ISSB-based rules elsewhere will want to test that claim against its own datasets during the comment period.
Where ISSB nature-related disclosures could apply
Exposure follows adoption of the ISSB standards, because the Practice Statement sits on top of IFRS S1 and IFRS S2. A jurisdiction that has adopted the standards can require the Practice Statement later. One that has not has no route to it.
The IFRS Foundation’s jurisdiction page lists 37 jurisdictions, with 24 profiles and 13 snapshots. Australia, Japan, Singapore and Hong Kong have published profiles. The UK and Canada appear as snapshots, which cover approaches that are finalised but whose profiles are still in development or whose regulatory status is in progress.
The Foundation said in April 2026 that more than 40 jurisdictions have decided to use the ISSB standards or are taking steps to introduce them. The European Union does not appear on the page, and the Foundation has held its profile pending the outcome of the Omnibus simplification of the first set of ESRS. The United States is also absent from the list.
The practical reading for a multinational finance team is that exposure depends on where each entity is listed or regulated. Subsidiaries in jurisdictions that adopt the standards would be first in line if a regulator turned the Practice Statement into a requirement.
What finance teams should do with the draft
Most of the work in the draft is data work. Assets and activities vulnerable to nature-related risk, measured by amount and percentage, need a link between operational data such as sites, suppliers and water use and the general ledger or fixed asset register. Many groups hold that information in separate systems. A plan to consolidate ESG data outside spreadsheets is the obvious first step.
Location-specific targets add a second requirement: records tied to a place, not only to a legal entity or cost centre. Finance teams will need owners for those records and a clear method for how each figure is derived.
Controls follow the data. Investors who rely on percentages of assets exposed to nature risk will expect the same discipline as for any reported number. An internal controls register that adds nature metrics alongside the existing ICFR entries gives assurance providers something to test.
Assurance scope is a decision for each company and its auditor. Companies that adopt voluntarily should agree early whether the nature metrics will fall inside any limited assurance engagement on their sustainability report.
Governance of the underlying models matters too, particularly where analysis of exposure relies on AI-assisted tools. Finance leaders can start from guidance on AI agent governance.
What comes next for the nature-related draft
Comments are due by February 19, 2027, through the Foundation’s online survey. The ISSB held a live webinar on the proposals on October 22 during the UN Convention on Biological Diversity conference, COP17, with Lloyd among the speakers.
After the consultation closes, the ISSB will decide the final form of the nature-related content, Practice Statement or standard, which sets out whether any jurisdiction could make it mandatory.
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