IFRS S2 Disclosure Checklist: 2026 Practitioner Walkthrough

If your team is preparing or reviewing climate disclosures under IFRS S2, this is the on-page checklist you can actually use. No registration wall, no PDF download, no unanswered questions about what each item really requires.

Key takeaway: IFRS S2 cannot be applied in isolation. IFRS S1 and IFRS S2 must always be applied together, every item below reflects that joint obligation. If you need a deep dive on the S1 framework itself, see our IFRS S1 disclosure requirements practitioner walkthrough.

The ISSB issued both standards in June 2023, with an effective date of annual reporting periods beginning on or after 1 January 2024. Calendar-year reporters filed their first mandatory disclosures in early 2025. If you are applying the standards under a local endorsement mechanism, check your jurisdiction's specific effective date before using this checklist.

Why You Need One Checklist for Both IFRS S1 and IFRS S2

IFRS S1 sets the framework; IFRS S2 specifies the climate content. IFRS S1 defines what a complete set of sustainability-related financial disclosures looks like, establishes the qualitative characteristics of useful information, and sets the rules on location, connectivity, and materiality. IFRS S2 then applies those same four content pillars to climate specifically, adding granular requirements for physical and transition risks, scenario analysis, and greenhouse gas emissions.

The practical implication: a checklist that covers only IFRS S2 paragraphs will miss material obligations. The EY ISSB Climate-related Disclosure Checklist addresses this by amending IFRS S1 language from 'sustainability-related financial information' to 'climate-related financial information' throughout, so users can see exactly which S1 requirements apply in the climate context. This checklist takes the same approach.

For the gap between TCFD and IFRS S2 specifically, see our TCFD vs IFRS S2 transition gap analysis. Existing TCFD disclosures are a starting point, not a finish line.

How to Use This Checklist

1. Confirm your jurisdiction's effective date using the tracker below before starting.
2. Identify which transitional reliefs you are electing and document that election in your basis of preparation.
3. Run the materiality filter first. Only disclose information that is material to primary users (investors, lenders, creditors). See the materiality section below for the critical distinction between ISSB single materiality and ESRS double materiality.
4. Work through each pillar in order: Governance, Strategy, Risk Management, Metrics and Targets.
5. Add Appendix B. After completing the four-pillar checklist, identify which of the 68 industry categories in IFRS S2 Appendix B apply to your sector and add those metrics.
6. Check connectivity. Every climate disclosure must connect to the relevant financial statement line items. This is an IFRS S1 requirement that many preparers miss entirely.
7. Confirm location. Disclosures must appear in the same general purpose financial report as the related financial statements, subject to limited cross-referencing conditions.

Pillar 1: Governance Checklist

Disclose the governance body or individual responsible for oversight of climate-related risks and opportunities, and how that oversight is exercised. This is the foundation of the Governance pillar under IFRS S2 paragraphs 10 and 13.

Board-level oversight (IFRS S2 paragraph 10)

• Identity of the governance body or individual(s) responsible for oversight of climate-related risks and opportunities
• How the board exercises oversight: frequency of climate agenda items, how it receives information, how it considers climate in strategic decisions and risk appetite
• Whether the board has climate-related skills or expertise, or how it accesses that expertise externally
• How climate-related performance metrics are factored into executive remuneration (if applicable)

Management's role (IFRS S2 paragraph 13)

• Management's role in assessing and managing climate-related risks and opportunities
• Whether dedicated controls and procedures exist for climate-related disclosures
• Whether climate-related considerations are integrated into management incentive structures
• How management reports to the board on climate matters

Common mistake: Disclosing that the board "oversees" climate risk without specifying the mechanism. Auditors and investors expect to see named committees, meeting frequency, and the information flows that make oversight real.

Pillar 2: Strategy Checklist

Describe the climate-related risks and opportunities that could reasonably be expected to affect the entity's prospects, and their effects on the business model, strategy, and financial position. IFRS S2 paragraphs 14 to 25 cover Strategy.

Climate risks and opportunities identified

• Physical risks (acute: extreme weather events; chronic: sea-level rise, shifting precipitation patterns) that are material
• Transition risks (policy and legal, technology, market, reputational) that are material
• Climate-related opportunities material to the entity
• Time horizons over which each risk or opportunity is expected to affect the entity (short, medium, long term), with the entity's own definition of those horizons

Effects on business model and strategy (IFRS S2 paragraph 14)

• Current and anticipated effects on the business model and value chain
• Current and anticipated effects on strategy and decision-making
• Transition plan: current and anticipated effects on business model and strategy, key assumptions, dependencies, and how the plan interacts with the entity's overall strategy (paragraph 14(b))
• If no transition plan exists, disclose that fact explicitly

Financial effects (IFRS S2 paragraphs 16-21)

• Current period financial effects: how climate risks and opportunities affected financial position, performance, and cash flows in the reporting period
• Anticipated financial effects over short, medium, and long term, including quantitative amounts where practicable
• Degree of uncertainty in estimates and assumptions used
• How climate risks and opportunities are reflected in specific financial statement line items (asset carrying amounts, provisions, impairment charges) -- this is the connectivity requirement from IFRS S1 paragraphs 58-60

Climate resilience and scenario analysis (IFRS S2 paragraph 22)

• Climate-related scenarios used, including the scenarios' key assumptions
• Time horizons applied in scenario analysis
• Results of the scenario analysis and what they imply for the entity's resilience
• At least two scenarios must be used, including one consistent with limiting warming to 1.5 degrees Celsius

Transitional relief -- scenario analysis: In the first reporting period, entities may use qualitative scenario analysis if quantitative analysis is not practicable. This relief does not extend to subsequent periods. Build the quantitative capability now; it will be required.

Common mistake: Treating scenario analysis as a box-ticking exercise with generic outputs. The standard requires disclosure of the specific scenarios used, the assumptions made, and what the results actually mean for the entity's strategy. Generic references to "well-below 2 degrees" scenarios without entity-specific analysis will not satisfy the requirement.

Pillar 3: Risk Management Checklist

Describe the processes used to identify, assess, prioritise, and manage climate-related risks, and how those processes are integrated into the entity's overall risk management framework. IFRS S2 paragraphs 26 to 28 cover Risk Management.

• Processes for identifying and assessing climate-related risks, including how the entity determines whether a climate risk is significant
• How physical and transition risks are assessed across the value chain
• Processes for prioritising climate-related risks relative to other risks, including parameters used
• Processes for managing (mitigating, transferring, accepting) climate-related risks
• Processes for identifying and assessing climate-related opportunities
• Whether and how the above processes are integrated into the entity's overall risk management process

Common mistake: Describing risk management processes in abstract terms without explaining how they connect to the entity's enterprise risk management framework. Deloitte's IAS Plus commentary flags this connectivity as one of the most challenging aspects for first-time preparers -- it requires coordination between sustainability and finance teams that many organisations have not yet established.

Pillar 4: Metrics and Targets Checklist

Disclose quantitative and qualitative information about the metrics and targets used to manage and monitor climate-related risks and opportunities. IFRS S2 paragraph 29 identifies six cross-industry metric categories that every entity must report, regardless of sector.

Cross-industry metrics (IFRS S2 paragraph 29) -- universal floor

• Scope 1 GHG emissions (absolute gross, in CO2 equivalent, measured per the GHG Protocol Corporate Standard)
• Scope 2 GHG emissions (absolute gross, location-based and/or market-based)
• Scope 3 GHG emissions (absolute gross, across all 15 categories of the GHG Protocol Corporate Value Chain Standard)
• GHG emissions intensity (per unit of economic output or physical output)
• Climate-related transition risks and physical risks embedded in financial statements (amounts and percentages of assets, liabilities, revenues, expenditures exposed)
• Capital deployment toward climate-related risks and opportunities (capital expenditure, financing, investment)
• Internal carbon price (if the entity uses one: the price per tonne of CO2 equivalent and the scope of application)
• Remuneration linked to climate considerations (percentage of executive remuneration linked to climate-related considerations, and how it is calculated)

Transitional relief -- Scope 3: Entities may omit Scope 3 GHG disclosures in the first annual reporting period in which they apply IFRS S2 (IFRS S2 paragraph E1). This relief applies once only. From the second year onward, Scope 3 is mandatory.

Targets (IFRS S2 paragraphs 33-36)

• For each climate-related target: the metric used, the objective, the time horizon, the base period, and any interim milestones
• Whether the target has been validated by a third party, and if so, which framework or body
• The methodology and significant assumptions used to set the target
• Progress against each target in the current period
• Whether the target is a GHG emissions target, and if so, whether it covers Scope 1, 2, and/or 3

Common mistake: Disclosing targets without progress data. The standard requires both the target and performance against it -- a commitment without a scorecard does not satisfy paragraph 33.

Industry-based metrics (IFRS S2 Appendix B) -- the most overlooked requirement

IFRS S2 Appendix B incorporates industry-based disclosure requirements derived from the SASB Standards across 68 industry categories. These apply in addition to the cross-industry metrics above. PwC notes that Appendix B is one of the most commonly misunderstood aspects of IFRS S2, with many preparers unaware that sector-specific metrics apply at all.

• Identify all SASB industry categories that apply to your entity's activities
• For each applicable category, disclose the industry-based metrics specified in Appendix B
• If your entity operates across multiple industry categories, apply the metrics for each

A few examples of what Appendix B requires by sector:

This is not an exhaustive list. Check the applicable SASB Standard for your sector directly.

Transitional Relief Tracker

Three reliefs are available to first-time preparers. Each applies once and does not roll forward.

Document each relief you elect in your basis of preparation. Auditors will ask.

Materiality: The Filter That Shapes the Whole Checklist

Under IFRS S2, materiality is assessed from the perspective of primary users of general purpose financial reports -- investors, lenders, and creditors -- not from a broader stakeholder perspective. This is single materiality, not the double materiality required under the EU's CSRD and ESRS framework.

The IFRS Foundation's educational materials on materiality clarify that information is material if omitting, misstating, or obscuring it could reasonably be expected to influence the decisions of primary users. The ISSB's Transition Implementation Group (TIG) has confirmed that IFRS S2 requires disclosure of risks and opportunities that are currently material, not those that are only potentially material in the future.

Practical implications for the checklist:

• A risk that is real but immaterial to investors does not require disclosure.
• A risk that is material to the community but not to investors is not in scope under IFRS S2 (though it may be under ESRS).
• Materiality is not a binary test -- it requires judgment, documentation, and consistency across reporting periods.

If your entity also reports under CSRD, the ISSB and EFRAG published interoperability guidance in May 2024 mapping IFRS S2 requirements to ESRS E1. This is essential reading for multinationals subject to both frameworks -- it identifies where a single disclosure satisfies both standards and where additional ESRS-specific content is required.

Location and Connectivity: Two Requirements Most Checklists Skip

Where must disclosures appear?

IFRS S1 paragraphs 58 to 60 require that sustainability-related financial disclosures appear in the same general purpose financial report as the related financial statements. Cross-referencing to information in other documents (a standalone sustainability report, a website) is permitted only under specific conditions: the information must be accessible on the same terms, be subject to the same level of scrutiny, and be incorporated by reference.

Checklist items:

• Confirm that all IFRS S2 disclosures appear in the general purpose financial report, or that cross-referencing conditions are satisfied
• If cross-referencing, confirm the referenced document is accessible, subject to equivalent scrutiny, and incorporated by reference in the financial report

Connectivity to financial statements

This is the requirement that trips up most first-time preparers. Climate disclosures must connect to specific financial statement line items -- asset carrying amounts, provisions, impairment charges, capital expenditure -- so that investors can trace the financial effect of climate risks through the accounts.

• For each material climate risk or opportunity, identify the relevant financial statement line items affected
• Disclose how climate considerations affected estimates and judgments in the financial statements (for example, asset useful lives, impairment assumptions, provision amounts)
• Ensure the sustainability team and finance team have reviewed disclosures jointly for consistency

Jurisdiction Adoption: Is IFRS S2 the Operative Standard in Your Market?

The ISSB baseline is effective for periods beginning on or after 1 January 2024, but local endorsement mechanisms mean the operative standard and effective date vary by jurisdiction.

AASB S2 and the SSBJ standards are substantively equivalent to IFRS S2 but with local modifications. The EY and KPMG checklists are ISSB-baseline only and do not capture these modifications. If you are reporting under a local endorsement, verify which paragraphs of the ISSB standard have been amended or supplemented in your jurisdiction.

FAQ

Does TCFD compliance satisfy IFRS S2? No. IFRS S2 is structured around the same four TCFD pillars, but goes further in several areas: mandatory cross-industry GHG metrics (including Scope 3), industry-based metrics from SASB Appendix B, explicit connectivity to financial statements, and more granular target disclosure requirements. TCFD was disbanded in October 2023 having confirmed that IFRS S2 is its successor. See our TCFD vs IFRS S2 gap analysis for a pillar-by-pillar comparison.

Do I need a separate checklist for IFRS S1? No. Because IFRS S1 and IFRS S2 must always be applied together, a complete IFRS S2 checklist necessarily incorporates the relevant IFRS S1 requirements. This checklist does that. For the full IFRS S1 framework across all sustainability topics (not just climate), see our IFRS S1 practitioner walkthrough.

What level of assurance is required for IFRS S2 disclosures? IFRS S2 itself does not mandate assurance. Assurance requirements depend on jurisdiction. Australia's AASB framework includes a phased assurance requirement; Singapore's SGX rules are moving in the same direction. In the absence of a mandatory requirement, many entities are obtaining limited assurance voluntarily to support credibility with investors. Build your disclosure controls with auditability in mind from the start -- the ICFR and climate disclosure audit walkthrough covers what that means in practice.

Can I cross-reference to a standalone sustainability report instead of including disclosures in the annual report? Yes, under specific conditions set out in IFRS S1 paragraphs 58 to 60. The referenced document must be accessible on the same terms as the annual report, subject to equivalent scrutiny, and incorporated by reference. A hyperlink to a website that may change does not satisfy this requirement.

What are TIG agenda decisions and do they affect this checklist? The ISSB's Transition Implementation Group addresses contested implementation questions from preparers. Its agenda decisions are not authoritative amendments to the standard, but they are highly influential. Key TIG decisions relevant to this checklist include: the confirmation that IFRS S2 requires disclosure of currently material risks only (not potentially material future risks), and guidance on the application of materiality in the climate context. Monitor the TIG page for new agenda decisions before each reporting cycle.

How does IFRS S2 interact with CSRD if we report under both? The ISSB and EFRAG published interoperability guidance in May 2024 mapping IFRS S2 requirements to ESRS E1. The key practical point: IFRS S2 uses single materiality (investor-focused); ESRS uses double materiality (investor plus broader stakeholder impact). A disclosure that satisfies IFRS S2 will often satisfy the corresponding ESRS E1 requirement, but ESRS requires additional content on the entity's impacts on climate that IFRS S2 does not. You will need both lenses if you are subject to both frameworks.