ISSB setting up shop in Montreal

The International Financial Reporting Standards Foundation is teaming up with CPA Canada to set up a Montreal center for the new International Sustainability Standards Board, in addition to a location in Frankfurt, Germany.

Last month, the IFRS Foundation, which also oversees the International Accounting Standards Board in London, signed a memorandum of understanding to establish the Frankfurt location (see story). The Montreal center will host some of the key functions on behalf of the ISSB, including the coordination of activity across the Americas. For now, there will also be a presence in San Francisco, where the Value Reporting Foundation is located, but the VRF — the recently merged group overseeing the Sustainability Accounting Standards Board and the International Integrated Reporting Council — is scheduled to be consolidated into the ISSB by the end of June.

The ISSB location in Frankfurt will host key functions and coordinate activities in the Europe, Middle East and Africa regions. Arrangements for the Asia-Oceania region are making progress.

The ISSB was established at the United Nations’ COP26 climate conference last November in an effort to unite the various sustainability standard-setters in response to the growing climate crisis and the increasing popularity of funds that invest in environmental, social and governance causes.

As part of the Montreal agreement, the IFRS Foundation signed a memorandum of understanding calling on CPA Canada to work collectively with a wide array of stakeholders that have come together to help fund and lend support to the ISSB and the Quebec-based center. CPA Canada spearheaded efforts to unite the group known as the Canadian Champions for Global Sustainability Standards and the agreement anticipates that leadership role will continue.

“Montreal has excellent sustainability credentials and a truly international outlook,” said IFRS Foundation trustees chair Erkki Liikanen in a statement Wednesday. “Along with Frankfurt, it will provide an effective base for the ISSB. I thank our Canadian colleagues for their commitment to the mission of the ISSB and support and enthusiasm for our work.”

Under the five-year agreement, Montreal will host significant standard-setting responsibilities and associated functions, including a share of board meetings, leadership and resources that reflect the Montreal location’s importance to the ISSB. The two signing parties have also committed themselves to the long-term success of the board and its Montreal presence. As part of its Americas coordination role, the Montreal center will work in close cooperation with the San Francisco office of the Value Reporting Foundation.

“I am delighted the trustees chose Montreal as a key location for the ISSB,” said ISSB chair Emmanuel Faber in a statement. “It provides a valuable sustainability ecosystem to support our future work and will provide an excellent base, along with Frankfurt, for our future success.”

The ISSB is making progress on other fronts. Last week, the ISSB proposed two sustainability and climate standards and is asking for comments on the exposure drafts by July 29 (see story). However, it is still in the process of forming the full slate of board members and will be able to draw upon CPA Canada’s ESG experts.

Montreal itself has been taking steps to reduce greenhouse gas emissions. “The choice of Montreal for an ISSB office is a strong testimony to our leadership in the global movement for sustainable development,” said Montreal Mayor Valérie Plante in a statement. “We have a crucial role to play in reducing our greenhouse gas emissions. Montreal has already taken steps in that direction, and it will now be involved in sustainable finance. Thanks to the work of the ISSB, companies will be encouraged to take on more green projects, to the benefit of the metropolis and its economy.”