IFRS / PFRS Transition Advisory
Navigate change. Strengthen resilience. Build investor confidence
Navigate change. Strengthen resilience. Build investor confidence
Sustainability reporting in the Philippines is entering a new phase. With the Securities and Exchange Commission strengthening sustainability disclosure requirements for publicly listed companies—and global investors increasingly aligning to the IFRS Sustainability Disclosure Standards (S1 & S2)—organizations are now expected to move beyond narrative ESG disclosures to structured, decision-useful, and investor-grade sustainability information.
Globally, over $120 trillion in assets under management are influenced by sustainability-related financial information, and capital markets are rapidly converging around IFRS-aligned disclosures. For Philippine companies, this shift is no longer optional. It directly affects access to capital, investor confidence, regulatory readiness, and long-term resilience.
Transitioning to IFRS sustainability disclosures requires more than repackaging existing ESG or GRI reports. It calls for integration with enterprise risk management, strategy, governance, and financial reporting processes—done in a way that is practical, phased, and proportionate to the organization’s maturity.
Following SEC’s issuance of Memorandum Circular No. 16, Series of 2025 which necessitates the adoption of IFRS S1 and S2 disclosures which centers on financial sustainability (S1) and climate-related disclosures (S2).
Starting FY 2026, companies are expected to gradually:
Both PLCs and LNLs are classified into Tier, each having its own designated deadlines for the relevant reporting categories and external assurance.
Understand current state and gaps against IFRS/PFRS requirements.
Define metrics, establish data boundaries, and improve internal controls and data quality.
Identify sustainability topics that are financially material and stakeholder-relevant.
Develop clear, compliant, and investor-ready sustainability disclosures aligned with IFRS and PFRS.
Identify and assess climate-related physical and transition risks and opportunities.
Prepare reports and systems for independent assurance and regulatory review.
Evaluate potential financial and strategic impacts of climate scenarios across channels.
Improves capital market credibility through consistent, decision-useful disclosures
Reduces regulatory and audit risk by strengthening governance, controls, and documentation
Enhances access to capital by aligning with investor and lender expectations
Integrates climate risk into financial planning and strategy, protecting long-term value
Drives reporting efficiency by standardizing data, processes, and accountability
