IFRS Foundation Issues Guidance on IFRS S2 Transition Plan Disclosures

Posted 07 August 2025 Written by Acts Online
Category Sustainability Reporting

Brought to you by SA Accounting Academy: The IFRS Foundation has released a new guidance document to assist entities in reporting on climate-related transition plans under the ISSB framework.

In terms of IFRS S2 Climate-related Disclosures, the IFRS Foundation has issued guidance titled “Disclosing information about an entity’s climate-related transition, including information about transition plans.” This document is designed to support the implementation of the International Sustainability Disclosure Standards (ISSB Standards) and reduce fragmentation in sustainability reporting.

The guidance builds upon disclosure-specific materials originally developed by the Transition Plan Taskforce (TPT), a body for which the IFRS Foundation assumed responsibility in 2024. It provides a framework for entities to deliver high-quality information regarding their transition toward a lower-carbon and climate-resilient economy.

Core Disclosure Requirements

While IFRS S2 does not explicitly mandate that an entity must adopt a transition plan, it does require the disclosure of all material information regarding sustainability-related risks and opportunities. Key regulatory aspects include:

  • Disclosure of how an entity mitigates and adapts to climate-related transition and physical risks.
  • Integration of transition plan information where such plans exist and are expected to affect the entity’s prospects.
  • Alignment with the ISSB global baseline to ensure comparability across jurisdictions.

Click here to download the IFRS Foundation Guidance on Transition Plan Disclosures.

What this means for you, your business, or your clients

  • For yourself: You must familiarise yourself with the Transition Plan Taskforce (TPT) materials now integrated into the IFRS Foundation framework to provide accurate sustainability reporting advice.
  • For your business: Professional practices must update their audit and assurance methodologies to reflect the specific disclosure requirements for climate-related transition plans as outlined in the new IFRS S2 guidance.
  • For your clients: Entities with existing climate transition plans must review their current disclosures to ensure they meet the materiality and specificity requirements of IFRS S2, particularly regarding risk mitigation and adaptation strategies.

Originally published at https://accountingacademy.co.za/news/read/ifrs-foundation-guidance-on-disclosures-about-transition-plans

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