Requirement
To achieve this objective, an entity shall disclose information about the governance body(s) (which can include a board, committee or equivalent body charged with governance) or individual(s) responsible for oversight of climate-related risks and opportunities. Specifically, the entity shall identify that body(s) or individual(s) and disclose information about the matters set out in paragraph 6(a)(i) through (v).
Verbatim · IFRS S2
What it means
IFRS S2 requires the entity to name the body or individual that sits at the top of the climate governance chain. This is not a rhetorical reference to "the board". The standard expects a specific answer: the Board of Directors, a specific standing committee, or a named executive role. The five sub-paragraphs that follow ask how that body or person is mandated, informed, equipped, and incentivised.
Plain English · Greentryst
Illustrative Disclosure
"The Board of Directors holds ultimate oversight of climate-related risks and opportunities, discharged primarily through the Risk and Sustainability Committee (RSC). The RSC reviews climate matters at each of its four annual meetings and escalates issues of strategic consequence to the full Board." The passage names the body, specifies the delegated committee, and states the cadence. Everything that follows in paragraphs 6(a)(i) to (v) refers back to this anchor.
What a good disclosure looks like
Requirement
How responsibilities for climate-related risks and opportunities are reflected in the terms of reference, mandates, role descriptions and other related policies applicable to that body(s) or individual(s).
Verbatim · IFRS S2
What it means
The governance body's climate mandate must exist on paper, not only in practice. The standard asks for a trace through the documented governance architecture: committee charters, delegation matrices, position descriptions, and board-reserved matters lists. If a committee is said to oversee climate, the charter should say so in terms that are specific and auditable.
Plain English · Greentryst
Illustrative Disclosure
"The terms of reference of the Risk and Sustainability Committee, approved by the Board in March 2024, expressly list 'oversight of climate-related financial risks and opportunities, including the transition plan' among the Committee's standing responsibilities. The Chief Executive Officer's position description and short-term incentive plan incorporate delivery against the approved transition plan as a measurable objective." The disclosure names the document, cites the approval date, and quotes the operative language.
What a good disclosure looks like
Requirement
How the body(s) or individual(s) determines whether appropriate skills and competencies are available or will be developed to oversee strategies designed to respond to climate-related risks and opportunities.
Verbatim · IFRS S2
What it means
The standard tests whether the people in the oversight seat actually know what they are overseeing. Disclosures should describe the mechanism used to assess climate competency on the board or in the delegated committee, the gaps identified, and the steps taken to close them. Skills matrices, director-level training programmes, and the recruitment of new members with climate or energy-transition credentials are all valid evidence.
Plain English · Greentryst
Illustrative Disclosure
"The Board completes an annual skills and capability audit. The 2024 audit identified a gap in physical-risk and scenario-analysis expertise, which was addressed through the appointment of a new non-executive director in September 2024 with a background in climate adaptation for the insurance sector, and through an external climate scenario workshop delivered to all directors in November 2024." The disclosure references the process, the finding, and two distinct remediations.
What a good disclosure looks like
Requirement
How and how often the body(s) or individual(s) is informed about climate-related risks and opportunities.
Verbatim · IFRS S2
What it means
Two questions, not one. "How" asks about the channel: standing agenda items, dedicated updates, quarterly risk dashboards, deep-dive workshops, external briefings. "How often" asks for the cadence: meeting frequency, escalation triggers, and what counts as a material update that warrants interrupting the regular flow.
Plain English · Greentryst
Illustrative Disclosure
"Climate-related risks and opportunities are a standing agenda item at every Risk and Sustainability Committee meeting (four per year). The Chief Sustainability Officer prepares a climate dashboard reviewed at each meeting; the dashboard includes progress against decarbonisation targets, physical-risk exposure indicators, and regulatory horizon scanning. Material deviations trigger an out-of-cycle report to the Committee Chair within ten business days."
What a good disclosure looks like
Requirement
How the body(s) or individual(s) takes into account climate-related risks and opportunities when overseeing the entity's strategy, its decisions on major transactions and its risk management processes and related policies, including whether the body(s) or individual(s) has considered trade-offs associated with those risks and opportunities.
Verbatim · IFRS S2
What it means
This is the decision-integration test. The standard wants evidence that climate is not a parallel conversation but an input to the decisions the board actually makes: strategy approvals, capital allocation, acquisitions and divestments, and risk appetite. The explicit reference to trade-offs is deliberate: if every climate decision is a win on every dimension, the disclosure is too thin to be credible.
Plain English · Greentryst
Illustrative Disclosure
"The Board's capital allocation framework, revised in 2024, requires every capital proposal above £25 million to include a transition-plan alignment assessment and a physical-risk screen. In its 2024 decision on the proposed acquisition of Company X, the Board weighed the opportunity to accelerate low-carbon product offerings against the acquired entity's elevated Scope 3 intensity. The acquisition proceeded with a conditional integration milestone requiring the acquired entity's Scope 1 and 2 emissions to be reported on the Group basis from completion and aligned with the Group's 2030 reduction target."
What a good disclosure looks like
Requirement
How the body(s) or individual(s) oversees the setting of targets related to climate-related risks and opportunities, and monitors progress towards those targets (see paragraphs 33 to 36), including whether and how related performance metrics are included in remuneration policies (see paragraph 29(g)).
Verbatim · IFRS S2
What it means
Three things rolled into one: target-setting, monitoring, and pay. The standard asks whether the governance body actively approved the climate targets, how frequently progress is reviewed, and whether any portion of executive remuneration is contingent on climate performance. If targets are set without board ownership or tracked without remuneration linkage, the disclosure should say so and explain the rationale.
Plain English · Greentryst
Illustrative Disclosure
"Climate targets are approved by the full Board on recommendation from the Risk and Sustainability Committee. Progress is reviewed at every quarterly Committee meeting and reported in full in the half-year and annual results cycles. From the 2024 performance year, twenty per cent of the Chief Executive's short-term incentive and fifteen per cent of the Long-Term Incentive Plan vest on measured progress against the absolute Scope 1 and 2 reduction target."
What a good disclosure looks like
Requirement
Management's role in the governance processes, controls and procedures used to monitor, manage and oversee climate-related risks and opportunities, including information about the matters set out in paragraph 6(b)(i) and (ii).
Verbatim · IFRS S2
What it means
Paragraph 6(a) covered the top of the house. Paragraph 6(b) covers the running of the plumbing: who inside management owns climate risk day to day, how responsibility is delegated, and what controls management has put in place to give the governance body something credible to oversee.
Plain English · Greentryst
Illustrative Disclosure
"Day-to-day management of climate-related risks and opportunities is led by the Chief Sustainability Officer, who chairs the monthly Climate Risk Working Group. The Working Group draws members from Finance, Operations, Procurement, Treasury, and Internal Audit. It reports quarterly to the Group Executive Committee and escalates through the Risk and Sustainability Committee to the Board."
What a good disclosure looks like
Requirement
Whether the role is delegated to a specific management-level position or management-level committee and how oversight is exercised over that position or committee.
Verbatim · IFRS S2
What it means
The question has two halves. The first is structural: is there a named executive or committee on the hook, or is the responsibility diffuse? The second is supervisory: who holds that person or committee accountable, and through what mechanism? A credible disclosure answers both.
Plain English · Greentryst
Illustrative Disclosure
"The Chief Sustainability Officer, reporting directly to the Chief Executive, is the named executive responsible for climate-related risks and opportunities. The Chief Executive reviews the Chief Sustainability Officer's delivery against agreed objectives quarterly, and the Chief Sustainability Officer's remit and performance contract are re-confirmed annually by the Risk and Sustainability Committee."
What a good disclosure looks like
Requirement
Whether management uses controls and procedures to support the oversight of climate-related risks and opportunities and, if so, how these controls and procedures are integrated with other internal functions.
Verbatim · IFRS S2
What it means
The integration test. Climate oversight is weak if it runs in parallel to, rather than inside of, the control environment already used for financial and operational risk. The disclosure should describe how climate risk is picked up by the enterprise risk framework, the internal audit plan, and the SOX-style internal control over reporting (where applicable), not merely state that controls exist.
Plain English · Greentryst
Illustrative Disclosure
"Climate-related risks are logged in the Group's enterprise risk register using the same likelihood and impact taxonomy applied to other principal risks. Climate-related disclosures are within the scope of Internal Audit's three-year rolling assurance plan; the 2024 plan included a targeted review of Scope 2 data flows from the facilities system to the Group GHG inventory. Controls over climate data are tested as part of the internal control over sustainability reporting programme, governed by the Group's Disclosure Committee."
What a good disclosure looks like
Requirement
In preparing disclosures to fulfil the requirements in paragraph 6, an entity shall avoid unnecessary duplication in accordance with IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1) (see paragraph B42(b) of IFRS S1). For example, although an entity shall provide the information required by paragraph 6, if oversight of sustainability-related risks and opportunities is managed on an integrated basis, the entity would avoid duplication by providing integrated governance disclosures instead of separate disclosures for each sustainability-related risk and opportunity.
Verbatim · IFRS S2
What it means
A practical concession. If the same board committee oversees climate alongside nature, human rights, and other sustainability matters, and the same management structure executes, IFRS S2 does not require a separate set of governance disclosures for climate. The entity can write the governance section once, mapped across the sustainability disclosures that apply.
Plain English · Greentryst
Illustrative Disclosure
"The Risk and Sustainability Committee oversees all sustainability-related financial risks and opportunities on an integrated basis, including climate, nature, and human capital. The governance disclosures in this report therefore apply in common to all sustainability-related disclosures. Matters specific to climate are cross-referenced below where relevant." The disclosure signals the integrated approach once, then avoids repeating it under every topical disclosure.
What a good disclosure looks like