The International Finance Corporation (IFC), a member of the World Bank Group, and the IFRS Foundation have signed a Memorandum of Understanding to strengthen sustainable capital markets by improving sustainability and climate reporting in emerging markets and developing economies (EMDEs). This strategic partnership, announced during London’s Climate Action Week, aims to standardize and enhance transparency in sustainability reporting across these regions. 

Martine Valcin, IFC Global Manager for Corporate Governance and ESG Advisory, highlighted the significance of this collaboration, emphasizing its potential to drive substantial progress in sustainability and climate reporting. The partnership seeks to ensure that EMDEs are not left behind in the global shift towards sustainable finance. 

The IFRS Foundation’s International Sustainability Standards Board (ISSB) issued two inaugural Standards in June 2023, aimed at delivering global consistency and comparability of sustainability-related financial disclosures for capital markets. Jurisdictions accounting for approximately 55% of global GDP are already moving towards adopting these Standards. 

The partnership between the IFC and IFRS Foundation will focus on implementing programs to promote and build capacity for the consistent application of the IFRS Sustainability Disclosure Standards in EMDEs. This includes developing toolkits and research publications, as well as conducting training programs to encourage sustainability reporting. Additionally, the partnership will provide technical assistance and tailored support to help jurisdictions adopt and implement these Standards effectively, leveraging IFC’s successful initiatives in countries like Bangladesh and Jordan. 

Jingdong Hua, ISSB Vice-Chair, expressed pride in collaborating with IFC, noting that this partnership will enhance the quality of sustainability and climate-related financial reporting, particularly in emerging markets and developing economies. The collaboration aims to bring structured and reliable sustainability information to the forefront of global markets, facilitating investments. 

Building on IFC’s extensive efforts, such as the Beyond the Balance Sheet program and the Sustainable Banking Network (SBFN), this partnership aligns with the new IFRS Sustainability Disclosure Standards and the European Sustainability Reporting Standards. The Beyond the Balance Sheet program has been pivotal in providing advisory services to improve sustainability and climate-related reporting in EMDEs. The SBFN, facilitated by IFC, serves as a global knowledge-sharing and capacity-building platform for financial sector regulators and industry associations in EMDEs. 

Sources: 

https://www.ifrs.org/news-and-events/news/2024/06/ifc-ifrs-foundation-announce-partnership-sustainability-reporting-emerging-markets/ 

https://pressroom.ifc.org/all/pages/PressDetail.aspx?ID=28254#:~:text=%E2%80%8BLondon%2C%20June%2027%2C%202024,and%20climate%20reporting%20in%20emerging