Submit RFP

      (This article was published on 6 February 2026 and updated on 22 July 2026)

      Highlights

      – What's the latest?

      – What's the impact?

      – What's next?

      – Actions for management

      With the deliberation phase now complete, the International Sustainability Standards Board (ISSB) will work towards issuing a draft practice statement in October 2026 for public comment.

      At its July 2026 meeting, the ISSB also published its assessment of the proposals’ expected costs and benefits.

      Barbara Zonneveld
      Barbara Zonneveld

      Sustainability Reporting Director

      KPMG International

      IFRS S1 already requires reporting on all material sustainability-related risks and opportunities, yet the growing investor focus on nature-related topics warrants more targeted guidance. Clearer guidance would help companies prepare consistent nature-specific disclosures that promote high-quality reporting and informed decision-making.

      Barbara Zonneveld

      Sustainability Reporting Director

      What's the latest?

      In July, the ISSB concluded its discussions on the proposed practice statement on nature-related reporting. It will begin the formal drafting, review and approval phase before releasing the proposals in October.

      Companies can access the ISSBTM assessment of the proposals. This can help them understand the ISSB’s perspective on the impacts and benefits of, as well as how to prepare for, reporting on nature.

      The table below summarises the ISSB’s decisions during the deliberations phase.

      Focus area

      Decision date

      ISSB decisions

      Defined terms

      June 2026
      • The proposals would define nature-related physical and transition risks to ensure both these types of risk are in scope of the nature-related disclosures, and to acknowledge how those risks arise and are managed may differ.

      Identifying risks and opportunities

      June 2026
      • Draft application guidance explains how nature-related risks and opportunities arise from dependencies and impacts on environmental resources and ecosystem services. It clarifies how companies may need to adapt strategy and business models in response to shifts in the external environment related to changes in nature.

      First-time application and compliance

      June 2026
      • The practice statement will be non-mandatory, but companies claiming compliance need to apply all of its requirements.
      • Companies can expect relief from reporting comparative information in the first year they apply the practice statement. This is regardless of whether they already apply IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information.

      Metrics

      June 2026
      • Companies could refer to the Taskforce on Nature-related Financial Disclosures (TNFD) metrics as a permitted source of guidance for making judgements related to nature-related risks and opportunities, provided that the resulting disclosures align with IFRS S1 objectives.

        Reference to the Climate Disclosure Standards Board’s framework application guidance in IFRS S1 would be retained, allowing companies to consider it when disclosing metrics on nature-related risks and opportunities.

      Identifying risks and opportunities

      May 2026
      • New guidance is proposed on companies using the TNFD’s LEAP approach1 to understand their interfaces with nature, evaluate related dependencies and impacts, and assess associated risks and opportunities. Companies using the LEAP approach may need to adapt it to ensure consistency with IFRS S1 objectives.

      Scenario analysis

      May 2026
      • The proposals would add incremental requirements for a company to disclose whether and how it uses scenario analysis in assessing the nature, likelihood and magnitude of nature-related risks, and identifying nature-related opportunities.
      • Scenario analysis would be required for assessing the resilience of nature-related strategies and business models. This would mirror the approach for climate-related assessments under IFRS S2 Climate-related Disclosures and would use similar proportionality mechanisms.

      Location-specific information

      April 2026
      • The proposals would require companies to disclose the amount and percentage of assets or business activities vulnerable to nature-related risks or aligned with nature-related opportunities. This guidance would be subject to the same proportionality mechanisms in IFRS S1.
      • The proposals will provide guidance on how to consider location when identifying nature-related risks and opportunities, and material information. This may also be relevant for reporting topics other than nature, such as climate.

      Indigenous peoples, local communities and affected stakeholders

      April 2026
      • The proposals would introduce application guidance on risks and opportunities arising from the relationship between nature and indigenous peoples, local communities and affected stakeholders. This guidance would illustrate a key connection between environmental and social topics.

      Transition plans

      March 2026
      • Companies would need to report on how they are transitioning their business to manage nature-related risks and opportunities. However, companies would not need to disclose a formal transition plan.

      Metrics

      March 2026
      • The proposals would not introduce cross-industry, nature-related metrics at this point. Instead, the ISSB proposes to update and enhance nature-related requirements in SASB industry-based standards.

      Targets and regulatory alignment

      March 2026
      • The proposals would not include requirements for specific nature-related targets. Instead, the ISSB proposes to add guidance and examples to IFRS S1 to explain what nature-related targets might look like.
      • Companies can also expect guidance to disclose whether and how local laws and regulations have informed any such targets.

      Project scope

       

      February 2026

       
      • The proposals would focus on nature-related risks and opportunities. As a result, the project was renamed from ‘BEES’ to ‘Nature-related Disclosures’.

      Defined terms

      February 2026
      • The project’s scope would encompass nature-related risks and opportunities, aligning with the scope of IFRS S2 for climate-related risks and opportunities, and would also draw on the TNFD recommendations.
      • Other important terms would also be defined, such as ecosystem services and environmental resources, used under the TNFD to explain the benefits and resources nature provides.

      Climate-nature nexus

      February 2026
      • Companies can expect targeted guidance on how to apply the existing connected information requirements in IFRS S1 and IFRS S2.
      • This proposed guidance would help companies explain the effects of climate-nature connections on a company’s risk profile; trade-offs between actions that address climate- and nature-related risks and opportunities; and synergies from addressing them together.

      What’s the impact?

      Companies already need to report material nature-related information under IFRS S1 (after their first year of reporting). This project aims to help them do so more effectively by providing additional direction on what nature-related information can be disclosed that could be relevant for investors’ decision-making.

      The draft practice statement is intended to provide more comprehensive support in applying IFRS S1, IFRS S2 and related SASB Standards to a broad range of nature-related topics, such as land use, pollution, resource extraction, water and biodiversity. The proposals also seek to align with European Sustainability Reporting Standards (ESRS) and the Global Reporting Initiative (GRI) Standards.

      By issuing the materials as an IFRS® practice statement, the ISSB aims to provide flexibility for preparers, while also minimising disruption as jurisdictions adopt IFRS S1 and IFRS S2. Jurisdictions could choose to mandate the guidance, which would have a similar effect to introducing a new sustainability disclosure standard.

      What’s next?

      The ISSB will discuss any sweep issues in future meetings, before finalising the draft practice statement. The draft is expected in October 2026 for a 120-day period of public consultation. The final practice statement will take time to develop and, once finalised, will need to be adopted locally to become mandatory.

      timeline

      Actions for management

      • Bookmark and revisit this page to stay informed about the project, including the proposals expected in October 2026.
      • Respond to the consultation once the proposals are released. This will be an opportunity to provide feedback and suggest improvements before the practice statement is finalised.
      • Understand how your company is exposed to nature-related risks and opportunities, including by familiarising yourself with the TNFD’s LEAP approach. If you are exposed, then consider how TNFD materials can help you to report, given that the ISSB is building its practice statement on them.
      • Companies planning to adopt the practice statement that report under ESRS and GRI Standards need to monitor the ISSB’s proposals closely. Although the ISSB aims to align with these standards, differences may emerge in the final proposals. 

      1 Locate, evaluate, assess, prepare (LEAP) is a four-phase assessment framework designed to help companies identify, manage and report on nature-related dependencies, impacts, risks and opportunities.

      © 2026 KPMG IFRG Limited, a UK company, limited by guarantee. All rights reserved.