ISSB Resources 4

Question 1

Under the GHG Protocol as referenced by ISSB, which Scope covers emissions from resource extraction and processing by an entity's suppliers?

Accepted Answer

Scope 3 upstream — emissions from purchased goods and services

Answer

Scope 3 upstream emissions include those generated by suppliers during the extraction, processing, and transportation of raw materials and purchased goods before they reach the reporting entity.

Question 2

How does IFRS S2 treat capital expenditures for transitioning from fossil fuel resources to renewable energy?

Accepted Answer

They must be disclosed as part of climate-related transition plans, including amounts and anticipated timing

Answer

IFRS S2 requires entities with climate transition plans to disclose associated CapEx and OpEx commitments, including amounts, timing, and the resource changes they are intended to achieve.

Question 3

What does IFRS S2 require regarding disclosure of an entity's energy resource mix?

Accepted Answer

Energy consumption broken down by fossil fuels and renewable sources, with intensity metrics when material

Answer

IFRS S2 requires disclosure of total energy consumption split between fossil fuel and renewable sources, plus energy intensity metrics, when energy is a material climate-related issue for the entity.

Question 4

Under ISSB, how broadly should companies assess resource-related risks in their supply chains for materiality purposes?

Accepted Answer

Resource risks should be assessed across the full value chain when they could affect the entity's financial performance

Answer

ISSB's materiality framework requires assessment of sustainability-related risks across the full value chain, including upstream supply chain resource risks that could ultimately affect financial performance.

Question 5

In ISSB's climate-related disclosure framework, what is a 'stranded asset'?

Accepted Answer

A resource or infrastructure asset that loses economic value earlier than expected due to climate transition forces

Answer

Stranded assets are resources or infrastructure — such as fossil fuel reserves or high-emission facilities — that may become economically unviable ahead of their expected useful life due to transition-related forces.

ISSB - International Sustainability Standards Board Practice Test

ISSB - International Sustainability Standards Board Practice Test

ISSB Resources 4