The International Financial Reporting Standards (IFRS) Foundation and Global Reporting Initiative (GRI) are set to align their capital market and multi-stakeholder standards for sustainability disclosure.

On March 24, the two organizations announced that their sustainability arms, the International Sustainability Standards Board (ISSB) and Global Sustainability Standards Board (GSSB), had signed a memorandum of understanding, seeking to coordinate their work programs and standard-setting activities.

Furthermore, the IFRS Foundation and the GRI will join each other’s consultative bodies related to sustainability reporting activities.

The two organizations pointed out that the need to meet the reporting needs of multiple standards represents a significant burden on companies and investors aiming to interpret data derived from different sources and methodologies.

GRI chief executive Eelco van der Enden called the memorandum a “strong signal to capital markets” that a comprehensive reporting system that combines “financial and impact materiality for sustainability reporting is possible on a global scale.”

GSSB chair Judy Kuszewski called the move “crucial” to the fight for consistent sustainability reporting by companies. She added that the GSSB was looking forward to “aligning work programs and to making the two-pillar corporate reporting system a reality, with financial and sustainability reporting on an equal footing.”