NDAMU SANDU
Zimbabwe opted for early adoption of the global benchmark by the International Sustainability Standard Board (ISSB) to influence in the writing of standards, experts have said.
Last year, Zimbabwe and Nigeria agreed to be early adopters of the International Financial Reporting Standards (IFRS) sustainability disclosure standards when they are finalised and issued by the ISSB. The standards will come on board by June 30.
Public Accountants and Auditors Board (PAAB) secretary Admire Ndurunduru told Business Times that Zimbabwe and the accountants regulatory body took a cue from a position by the African ministers of Finance for early adoption of the standards and a committee has been established as the country seeks to play a key role in the writing of the standards.
“As Zimbabwe and Africa, we have taken a call to say we will not be standard takers. What has been prepared out there makes sense, let’s take it. We have made a call to participate and influence in the standards setting process,” Ndurunduru said.
He said countries need capacity development to roll out and implement the standards. He said PAAB has set up structures that will participate in the standard setting, that will support adoption of the standards and that will drive capacity building and the roll out of the standards.
“Through early adoption, we will unlock capacity building and unlock support from the International Sustainability Standards Board. We will unlock support from the International Sustainability Standards Board to get the market through the implementation processes,” Ndurunduru said.
Last year, Finance and Economic Development minister Mthuli Ncube said Zimbabwe has agreed to be an early adopter of the standards, a move which will attract investments and boost private sector development.
He said early adoption would help “unlock” and bring to the country capacity building and support as Zimbabwe prepares for implementation and rollout. He urged the ISSB to work closely with PAAB as a first mover and to provide strong “advisory and capacity building support to achieve early adoption.
ISSB is working on the proposed general requirements standard which sets out disclosure of material information about sustainability-related risks and opportunities, among others.
Its proposed climate-related disclosures standard mandates disclosure of material information about climate-related risks and opportunities. It requires disclosure of information about physical risks (flood risk), transition risk (regulatory change) and climate related opportunities (new technology).
Ndurunduru said there are calls for the ISSB to set up an office on the continent for Africa to fully take part in proceedings.
“The ISSB has taken a strategy to be represented in various capitals of the world. They are in Frankfurt, Canada and they would be in China. Our call to IFRS Foundation is for us to have representation in Africa so that as discussions on the standards are being made, there is contextualisation of the thinking from the African continent. Yes, we have made the request to have representations on the African continent,” he said.
Stanbic chief executive Solomon Nyanhongo said the International Sustainability Standards by Zimbabwe in an exciting development, as we are one of the early adopters “puts us on the map as a nation eager of doing the right thing”.
The new standards come amid global convergence on the need for non-financial disclosures to give a complete picture.
IFRS Foundation chairman Erkki Liikanen told participants at a Stanbic Bank Zimbabwe breakfast meeting on International Sustainability Reporting Standards in Harare last week that his organisation’s approach to sustainability is that it is ready to serve if there is demand.
The former governor of the Bank of Finland was in Harare on a conversation around the developments in early adoption of the International Sustainability Reporting Standards and the progress made, challenges ahead or support necessary for Zimbabwe to achieve these objectives.
He said when IFRS was asked to go beyond this task, the September 2020 global consultation was organised and there were two questions: is there a need for global sustainability standards and should the IFRS Foundation play a role.
Liikanen said the response was an “urgent demand for action and a broad demand for IFRS Foundation to play a role”.
