ISSB Targets October 2026 for Nature-Related Disclosure Exposure Draft

ISSB Vice-Chair Sue Lloyd has previewed the International Sustainability Standards Board's nature-related disclosure proposals at the IFRS Foundation Conference in London, confirming that the ISSB finalised its decision-making on the content of the proposals and is targeting October 2026 for publication as an Exposure Draft. The proposals take the form of a Practice Statement, subject to the same due process as a Standard, designed to support companies providing nature-related disclosures to meet investor information needs while building on the existing requirements in IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information. Lloyd explained the rationale for developing nature-related guidance as a Practice Statement rather than a mandatory Standard, citing the objective of supporting improved nature-related disclosure while avoiding overloading companies and jurisdictions already focused on implementing IFRS S1 and IFRS S2.

 

The Practice Statement Approach and Its Strategic Rationale

 

The decision to develop nature-related guidance as a voluntary Practice Statement that companies can choose to use, rather than a mandatory Standard, reflects the ISSB's assessment of the current implementation burden facing companies and jurisdictions worldwide as they work through adoption of the existing IFRS S1 and IFRS S2 climate-related disclosure standards. Lloyd said the ISSB sees a real opportunity to address fragmentation in the disclosure landscape through the proposed Practice Statement by drawing on the TNFD framework and building on IFRS S1 and IFRS S2, with the Practice Statement format enabling this without disrupting implementation and adoption of ISSB Standards around the world. This sequencing decision reflects a deliberate prioritisation choice that protects the integrity and pace of climate disclosure adoption, which remains the ISSB's primary global standard-setting achievement, while still advancing nature-related disclosure capability for companies and investors who need it now.

The Practice Statement's voluntary status for companies does not preclude individual jurisdictions from mandating its use within their own regulatory frameworks, providing flexibility for regulators in markets where nature-related financial risk is judged to be sufficiently material to warrant mandatory disclosure while allowing other jurisdictions to defer such requirements until their climate disclosure implementation matures further. Lloyd noted that by developing these proposals as a Practice Statement rather than a Standard, the ISSB is leaving the door open for a future Standard, signalling that the current approach represents an intermediate step in a longer-term trajectory toward more formalised nature-related disclosure requirements rather than a permanent voluntary framework. This phased approach allows the ISSB to build practical implementation experience and refine methodological approaches through voluntary adoption before potentially elevating nature disclosure to mandatory Standard status once both the framework and market readiness have matured.

 

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Integration with TNFD and Existing Climate Disclosure Architecture

 

The ISSB's decision to draw on the Taskforce on Nature-related Financial Disclosures framework in developing its Practice Statement proposals provides important continuity for companies and investors who have already begun implementing TNFD-aligned nature disclosure on a voluntary basis, reducing the risk of creating competing or inconsistent disclosure frameworks that would increase compliance complexity without improving information quality. The requirement that the Practice Statement be used together with IFRS S1 and IFRS S2 Climate-related Disclosures rather than as a standalone framework reflects the ISSB's recognition that nature and climate risks are interconnected and that companies' sustainability disclosure should present an integrated picture of environmental risk and impact rather than treating nature and climate as separate reporting silos. This integration requirement is technically significant because it means companies using the Practice Statement will need to ensure consistency between their climate risk disclosures under IFRS S2 and their nature-related disclosures, potentially requiring more sophisticated internal sustainability data management systems that can support coherent reporting across both dimensions.

Building the nature Practice Statement on the foundation of IFRS S1's general sustainability disclosure requirements ensures methodological consistency with the broader ISSB disclosure architecture, including the materiality assessment approach, governance disclosure requirements and the connection between sustainability-related risks and opportunities and a company's enterprise value that characterises the ISSB's overall standard-setting philosophy. For companies already implementing IFRS S1 and IFRS S2, the Practice Statement's alignment with familiar disclosure concepts and structures should reduce the incremental implementation burden of extending sustainability reporting capability to encompass nature-related risks and impacts.

 

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Implications for Corporate Nature Disclosure Practice

 

The October 2026 Exposure Draft publication target provides companies, investors and other stakeholders with a defined timeline for engaging with the ISSB's nature disclosure proposals through the formal consultation process that will follow publication, offering an opportunity to shape the final Practice Statement before it is finalised. Companies that have already begun voluntary TNFD-aligned nature disclosure will be best positioned to adopt the ISSB's Practice Statement efficiently once finalised, given the explicit design intention to build on the TNFD framework rather than create a substantially different disclosure architecture. The voluntary nature of the Practice Statement means that near-term corporate nature disclosure practice will continue to be shaped primarily by jurisdiction-specific requirements, investor expectations and voluntary frameworks like TNFD until and unless individual regulators choose to mandate the ISSB Practice Statement or the ISSB itself transitions the guidance to a mandatory Standard in a future phase.

 

Outlook for ISSB Nature Disclosure Development

 

The ISSB's measured approach to nature-related disclosure development, prioritising Practice Statement guidance that protects climate disclosure implementation momentum while still advancing nature disclosure capability, reflects pragmatic global standard-setting that balances the urgency of addressing nature-related financial risk against the practical constraints facing companies and regulators managing multiple simultaneous sustainability reporting obligations. Whether the Exposure Draft consultation process beginning in October 2026 will validate the Practice Statement approach or generate stakeholder pressure for more immediate mandatory Standard development will depend on the balance of views expressed by investors seeking comparable nature disclosure data and companies and regulators prioritising manageable implementation sequencing. Sustained engagement from investors, companies, civil society and regulators throughout the consultation process will be essential for ensuring the final Practice Statement effectively addresses nature-related financial risk disclosure needs while maintaining the practical implementability that has characterised the ISSB's successful global adoption of its climate disclosure standards to date.

 

Source: ISSB