CVM Resolution No. 217 of October 29, 2024

SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4º Andar, Brasília/DF – CEP: 70712-900 – Brasil -Tel.: (61) 3327-2030/2031 www.cvm.gov.br RESOLUTION CVM NO. 217, OF OCTOBER 29, 2024 Approves Technical Pronouncement CBPS No. 01 – General Requirements for Disclosure of Financial Information Related to Sustainability, issued by the Brazilian Sustainability Pronouncements Committee – CBPS.

THE PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION OF BRAZIL – CVM makes public that the Collegiate Board, in a meeting held on October 16, 2024, based on §§ 3 and 5 of art. 177 of Law No.
6,404, of December 15, 1976, combined with items II and IV of § 1 of art. 22 of Law No. 6,385, of December 7, 1976, APPROVED the following Resolution:

Art. 1 It is made mandatory for publicly-held companies the Technical Pronouncement CBPS No. 01, issued by the Brazilian Sustainability Pronouncements Committee – CBPS, according to Annex “A” to this Resolution.

Art. 2 This Resolution enters into force on November 1, 2024, applying to fiscal years starting on or after January 1, 2026.

§ 1 Early adoption of Technical Pronouncement CBPS No. 01 is permitted, if the option established in art. 1 of CVM Resolution No. 193, of October 20, 2023, is exercised.

§ 2 In case of opting for early adoption, the entity must disclose this fact and apply the Technical Pronouncement CBPS No. 02 – Disclosures Related to Climate, at the same time.

Signed electronically by
JOÃO PEDRO BARROSO DO NASCIMENTO
President

SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4º Andar, Brasília/DF – CEP: 70712-900 – Brasil -Tel.: (61) 3327-2030/2031 www.cvm.gov.br RESOLUTION CVM NO. 217, OF OCTOBER 29, 2024.
ANNEX “A”
BRAZILIAN SUSTAINABILITY PRONOUNCEMENTS COMMITTEE TECHNICAL PRONOUNCEMENT CBPS 01 General Requirements for Disclosure of Financial Information Related to Sustainability Correlation to International Sustainability Standard - IFRS S1

TABLE OF CONTENTS
Item
OBJECTIVE 1
SCOPE 5
CONCEPTUAL FOUNDATIONS 10
Proper Presentation 11
Materiality 17
Reporting Entity 20
Connected Information 21
MAIN CONTENT 25
Governance 26
Strategy 28
Risk Management 43
Metrics and Targets 45
GENERAL REQUIREMENTS 54
Sources of Guidance 54
Location of Disclosures 60
Timing of Reporting 64
Comparative Information 70
Statement of Compliance 72

SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4º Andar, Brasília/DF – CEP: 70712-900 – Brasil -Tel.: (61) 3327-2030/2031 www.cvm.gov.br RESOLUTION CVM NO. 217, OF OCTOBER 29, 2024.
JUDGMENTS, UNCERTAINTIES AND ERRORS 74
Judgments 74
Uncertainty in measurement 77
Errors 83
APPENDICES
A Definition of terms
B Application Guidance
C Sources of Guidance
D Qualitative characteristics of relevant sustainability-related financial information E Effective Date and Transition

CBPS 01 General Requirements for Disclosure of Financial Information Related to Sustainability is defined in items 1–86 and Appendices A–E. All items have equal authority.
Items in bold describe the most important principles. Terms defined in Appendix A are in italics the first time they appear in the Standard. Definitions of other terms are provided in other CBPS Sustainability Disclosure Pronouncements. The Standard should be read in the context of its objective and the Basis for Conclusions.

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CBPS 01 - General Requirements for Disclosure of Financial Information Related to Sustainability

Objective
1 The objective of CBPS 01 General Requirements for Disclosure of Financial Information Related to Sustainability is to require the entity to disclose information about its sustainability-related risks and opportunities that are useful to the primary users of general purpose financial reports for the purpose general in making decisions related to the provision of resources to the entity. 1 2 Information about sustainability-related risks and opportunities is relevant to the primary users because the entity’s ability to generate cash flows in the short, medium and long term is intrinsically linked to the interactions between the entity and its stakeholders, society, the economy and the natural environment throughout the entity’s value chain. Together, the entity and the resources and relationships throughout its value chain form an interdependent system in which the entity operates. The entity’s dependencies on these resources and relationships and its impacts on these resources and relationships give rise to risks and opportunities related to sustainability for the entity. 3 This Standard requires the entity to disclose information about all sustainability-related risks and opportunities that could reasonably affect its cash flows, its access to financing or cost of capital in the short, medium or long term. For the purposes of this Standard, these risks and opportunities are collectively referred to as “sustainability-related risks and opportunities that could reasonably affect the entity’s prospects”. 4 This Standard also prescribes how the entity prepares and communicates its sustainability-related financial disclosures. It establishes general requirements for the content and presentation of these disclosures so that the information disclosed is relevant to the primary users in making decisions related to the provision of resources to the entity.

Scope
5 The entity shall apply this Standard when preparing and presenting sustainability-related financial disclosures in accordance with the CBPS Sustainability Disclosure Pronouncements.
6 Sustainability-related risks and opportunities for which there is no reasonable expectation of affecting the entity’s prospects are outside the scope of this Standard.
7 Other CBPS Sustainability Disclosure Pronouncements specify information that the entity shall disclose about specific sustainability-related risks and opportunities.
Throughout this Standard, the terms “primary users” and “users” are used interchangeably, with the same meaning.

SCN Q.02 – Bl. A – Ed. Corporate Financial Center, S.404/4º Andar, Brasília/DF – CEP: 70712-900 – Brasil -Tel.: (61) 3327-2030/2031 www.cvm.gov.br RESOLUTION CVM NO. 217, OF OCTOBER 29, 2024.
8 The entity may apply the CBPS Sustainability Disclosure Pronouncements regardless of whether the entity’s general purpose financial statements (referred to as “financial statements”) are prepared in accordance with the Technical Pronouncements of the CPC or other generally accepted accounting principles or practices (GAAP). 9 This Standard uses terminology appropriate for for-profit entities, including public sector entities. If entities with non-profit activities in the private or public sector apply this Standard, they may need to change the descriptions used for certain items of information in the application of the CBPS Sustainability Disclosure Pronouncements.

Conceptual Foundations
10 For sustainability-related financial information to be useful, it must be relevant and faithfully represent what it purports to represent. These are fundamental qualitative characteristics of relevant sustainability-related financial information. The utility of sustainability-related financial information is enhanced if the information is comparable, verifiable, timely and understandable. These are qualitative characteristics of improvement of useful sustainability-related financial information (see Appendix D).

Proper Presentation
11 A complete set of sustainability-related financial disclosures should present properly all sustainability-related risks and opportunities that could reasonably affect the entity’s prospects.
12 To identify sustainability-related risks and opportunities that could reasonably affect the entity’s prospects, the entity shall apply items B1–B2.
13 Proper presentation requires the disclosure of relevant information about sustainability-related risks and opportunities that could reasonably affect the entity’s prospects and their faithful representation in accordance with the principles established in this Standard. To obtain a faithful representation, the entity shall provide a complete, neutral and accurate description of these sustainability-related risks and opportunities. 14 Materiality is an aspect of relevance specific to the entity, based on the nature or magnitude, or both, of the items to which the information refers, in the context of the entity’s sustainability-related financial disclosures. 15 Proper presentation also requires the entity to:
(a) disclose comparable, verifiable, timely and understandable information; and (b) disclose additional information if compliance with the specifically applicable requirements of the CBPS Sustainability Disclosure Pronouncements is insufficient to allow users of general purpose financial reports to understand the effects of sustainability-related risks and opportunities on the entity’s cash flows, its access to financing and the cost of capital in the short, medium and long term.

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16 It is presumed that the application of the CBPS Sustainability Disclosure Pronouncements, with additional information disclosed when necessary (see item 15(b)), results in sustainability-related financial disclosures that achieve a proper presentation.

Materiality
17 The entity shall disclose material information about sustainability-related risks and opportunities that could reasonably affect the entity’s prospects.
18 In the context of sustainability-related financial disclosures, information is material if the omission, misstatement or obscuring of that information could reasonably influence the decisions that the primary users of general purpose financial reports make based on those reports, which include financial statements and sustainability-related financial disclosures and that provide information about the specific reporting entity. 19 To identify and disclose material information, the entity shall apply items B13–B37.

Reporting Entity
20 The entity’s sustainability-related financial disclosures shall be of the same entity that reports its respective financial statements (see item B38).

Connected Information
21 The entity shall provide information in a manner that allows users of general purpose financial reports to understand the following types of connections:
(a) the connections between the items to which the information refers – such as the connections between various sustainability-related risks and opportunities that could reasonably affect the entity’s prospects; and (b) the connections between disclosures provided by the entity:
(i) within its sustainability-related financial disclosures – such as connections between disclosures on governance, strategy, risk management and metrics and targets; and (ii) in its sustainability-related financial disclosures and in other general purpose financial reports published by the entity – such as their respective financial statements (see items B39-B44). 22 The entity shall identify the financial statements to which the sustainability-related financial disclosures refer. 23 The data and assumptions used in the preparation of sustainability-related financial disclosures shall be consistent – to the extent possible considering the requirements of the CPC Technical Pronouncements or other applicable GAAP – with the data and assumptions corresponding used in the preparation of the respective financial statements (see item B42).

24 When the currency is specified as the unit of measure in sustainability-related financial disclosures, the entity shall use the currency of presentation of its respective financial statements.

Main Content

25 Unless another CBPS Disclosure Pronouncement permits or requires otherwise in specific circumstances, the entity shall provide disclosures on:
(a) governance – the governance processes, controls, and procedures that the entity uses to monitor and manage risks and opportunities related to sustainability (see items 26-27); (b) strategy – the approach that the entity uses to manage risks and opportunities related to sustainability (see items 28-42); (c) risk management – the processes that the entity uses to identify, assess, prioritize, and monitor risks and opportunities related to sustainability (see items 43-44); and (d) metrics and targets – the entity’s performance with regard to risks and opportunities related to sustainability, including progress towards any targets that the entity has set or whose compliance is required by law or regulation (see items 45-53).

Governance

26 The objective of sustainability-related financial disclosures on governance is to enable users of general purpose financial reports to understand the governance processes, controls, and procedures that the entity uses to monitor, manage, and oversee risks and opportunities related to sustainability.

27 To achieve this objective, the entity shall disclose information about:
(a) the governing body (which may include a board, committee, or equivalent body) or individual(s) responsible for oversight of risks and opportunities related to sustainability. Specifically, the entity shall identify this body or individual(s) and disclose information about:
(i) how responsibilities for risks and opportunities related to sustainability are reflected in the terms of reference, mandates, job descriptions, and other related policies applicable to this body or individual(s); (ii) how the body or individual(s) determines whether adequate skills and competencies exist or will be developed to oversee strategies designed to respond to risks and opportunities related to sustainability;

(iii) how and how often the body or individual(s) is informed about risks and opportunities related to sustainability; (iv) how the body or individual(s) takes into account risks and opportunities related to sustainability when overseeing the entity’s strategy, its decisions on major transactions, and its risk management processes and related policies, including whether the body or individual(s) considered trade-offs associated with these risks and opportunities; and (v) how the body or individual(s) oversees the setting of targets regarding risks and opportunities related to sustainability and monitors progress towards these targets (see item 51), including whether and how their performance metrics are included in remuneration policies. (b) the role of management in the governance processes, controls, and procedures used to monitor, manage, and oversee risks and opportunities related to sustainability, including information about:
(i) whether the role is delegated to a specific management-level position or a management-level committee and how oversight is exercised over that position or committee; and (ii) whether management uses controls and procedures to support the oversight of risks and opportunities related to sustainability and, if so, how these controls and procedures are integrated with other internal functions.

Strategy

28 The objective of sustainability-related financial disclosures on strategy is to enable users of general purpose financial reports to understand the entity’s strategy for managing risks and opportunities related to sustainability.

29 Specifically, the entity shall disclose information to enable users of general purpose financial reports to understand:
(a) the risks and opportunities related to sustainability that could reasonably affect the entity’s prospects (see items 30–31); (b) the actual and predicted effects of these risks and opportunities related to sustainability on the entity’s business model and value chain (see item 32); (c) the effects of these risks and opportunities related to sustainability on the entity’s strategy and decision-making (see item 33); (d) the effects of these risks and opportunities related to sustainability on the entity’s balance sheet, statement of profit or loss, and cash flows for the reporting period, and their predicted effects on the entity’s balance sheet, statement of profit or loss, and cash flows in the short, medium, and long term, taking into account how these risks and opportunities related to sustainability were considered in the entity’s financial planning (see items 34–40); and (e) the resilience of the entity’s strategy and business model to these sustainability-related risks (see items 41-42).

Risks and opportunities related to sustainability

30 The entity shall disclose information that enables users of general purpose financial reports to understand the risks and opportunities related to sustainability that could reasonably affect the entity’s prospects. Specifically, the entity shall:
(a) describe the risks and opportunities related to sustainability that could reasonably affect the entity’s prospects; (b) specify the time horizons – short, medium, or long term – over which the effects of each of these risks and opportunities related to sustainability could reasonably occur; and (c) explain how the entity defines ‘short term’, ‘medium term’, and ‘long term’ and how these definitions are linked to the planning horizons used by the entity for strategic decision-making.

31 The short, medium, and long-term time horizons may vary between entities and depend on many factors, including specific industry characteristics, such as cash flow, investment and business cycles, the planning horizons generally used in the entity’s industry for strategic decision-making and capital allocation plans, and the time horizons over which users of general purpose financial reports perform their assessments of entities in that sector.

Business model and value chain

32 The entity shall disclose information that enables users of general purpose financial reports to understand the actual and predicted effects of risks and opportunities related to sustainability on the entity’s business model and value chain. Specifically, the entity shall disclose:
(a) a description of the actual and predicted effects of risks and opportunities related to sustainability on the entity’s business model and value chain; and (b) a description of where risks and opportunities related to sustainability are concentrated in the entity’s business model and value chain (for example, geographic areas, facilities, and types of assets).

Strategy and decision-making

33 The entity shall disclose information that enables users of general purpose financial reports to understand the effects of risks and opportunities related to sustainability on its strategy and decision-making. Specifically, the entity shall disclose information about:

(a) how the entity has responded and plans to respond to risks and opportunities related to sustainability in its strategy and decision-making; (b) the progress of plans disclosed by the entity in previous reporting periods, including quantitative and qualitative information; and (c) trade-offs between risks and opportunities related to sustainability considered by the entity (for example, when making a decision about the location of new operations, the entity may have considered the environmental impacts of these operations and the employment opportunities it would create in a community).

Balance sheet, statement of profit or loss, and cash flows

34 The entity shall disclose information that enables users of general purpose financial reports to understand:
(a) the effects of risks and opportunities related to sustainability on the entity’s balance sheet, statement of profit or loss, and cash flows for the reporting period (actual financial effects); and (b) the predicted effects of risks and opportunities related to sustainability on the entity’s balance sheet, statement of profit or loss, and cash flows in the short, medium, and long term, taking into account how risks and opportunities related to sustainability are included in the entity’s financial planning (predicted financial effects).

35 Specifically, the entity shall disclose quantitative and qualitative information about:
(a) how risks and opportunities related to sustainability affected its balance sheet, statement of profit or loss, and cash flows for the reporting period; (b) the risks and opportunities related to sustainability identified in item 35(a) for which there is a significant risk of material adjustment to the carrying amounts of assets and liabilities presented in the financial statements; (c) how the entity expects its balance sheet to change in the short, medium, and long term, given its strategy for managing risks and opportunities related to sustainability, taking into account:
(i) its investment and divestment plans (for example, capital expenditure (CAPEX) investment plans, significant acquisitions and divestments, joint ventures, business transformation, innovation, new business areas, and asset decommissioning), including plans with which the entity is not yet contractually committed; and (ii) its planned funding sources to implement its strategy; and (d) how the entity expects its statement of profit or loss and cash flows to change in the short, medium, and long term, given its strategy for managing risks and opportunities related to sustainability.

36 When providing quantitative information, the entity may disclose a single value or a range of values.

37 When preparing disclosures on the predicted financial effects of a sustainability-related risk or opportunity, the entity shall:
(a) use all reasonable and verifiable information available at the reporting date, without excessive cost or effort (see items B8–B10); and (b) use an approach consistent with the skills, capabilities, and resources available to prepare these disclosures.

38 The entity is not required to provide quantitative information on the actual or predicted financial effects of a sustainability-related risk or opportunity if the entity determines that:
(a) these effects are not identifiable separately; or (b) the level of measurement uncertainty involved in estimating these effects is so high that the resulting quantitative information would not be relevant (see items 77–82).

39 Furthermore, the entity is not required to provide quantitative information on the predicted financial effects of a sustainability-related risk or opportunity if the entity does not have the skills, capabilities, or resources to provide them.

40 If the entity determines that it is not required to provide quantitative information on the actual or predicted financial effects of a sustainability-related risk or opportunity by applying the criteria established in items 38–39, the entity shall:
(a) explain why it did not provide quantitative information; (b) provide qualitative information on these financial effects, including the identification of line items, totals, and subtotals, within the respective financial statements, that are likely to be affected, or have been affected, by this sustainability-related risk or opportunity; and (c) provide quantitative information on the financial effects of this sustainability-related risk or opportunity combined with other sustainability-related risks or opportunities and other factors, unless the entity determines that quantitative information on the combined financial effects would not be relevant.

Resilience

41 The entity shall disclose information that enables users of general purpose financial reports to understand the entity’s ability to adjust to uncertainties arising from sustainability-related risks. The entity shall disclose a qualitative assessment and, if applicable, a quantitative assessment of the resilience of its strategy and business model with regard to its sustainability-related risks, including information on how the assessment was performed and its time horizon. When providing quantitative information, the entity may disclose a single value or a range of values.

42 Other CBPS Disclosure Pronouncements may specify the type of information the entity is required to disclose about its resilience to specific sustainability-related risks and how to prepare these disclosures, including whether a scenario analysis is required.

Risk management

43 The objective of sustainability-related financial disclosures on risk management is to enable users of general purpose financial reports to:
(a) understand the entity’s processes for identifying, assessing, prioritizing, and monitoring risks and opportunities related to sustainability, including whether and how these processes are integrated and inform the entity’s overall risk management process; and (b) assess the entity’s overall risk profile and its overall risk management process.

44 To achieve this objective, the entity shall disclose information about:
(a) the processes and related policies that the entity uses to identify, assess, prioritize, and monitor sustainability-related risks, including information about:
(i) the data and parameters that the entity uses (for example, information on data sources and the scope of operations covered in the processes); (ii) whether and how the entity uses scenario analysis to inform its identification of sustainability-related risks; (iii) how the entity assesses the nature, probability, and magnitude of the effects of these risks (for example, whether the entity considers qualitative factors, quantitative thresholds, or other criteria); (iv) whether and how the entity prioritizes sustainability-related risks relative to other types of risk; (v) how the entity monitors sustainability-related risks; and (vi) whether and how the entity has changed the processes it uses compared to the previous reporting period; (b) the processes that the entity uses to identify, assess, prioritize, and monitor sustainability-related opportunities; and (c) the extent to which and how the processes for identifying, assessing, prioritizing, and monitoring risks and opportunities related to sustainability are integrated and inform the entity’s overall risk management process.

Metrics and targets

45 The objective of sustainability-related financial disclosures on metrics and targets is to enable users of general purpose financial reports to understand the entity’s performance with regard to its risks and opportunities related to sustainability, including progress towards any targets that the entity has set and any targets whose compliance is required by law or regulation.

46 The entity shall disclose, for each of the risks and opportunities related to sustainability that could reasonably affect the entity’s prospects:
(a) the metrics required by an applicable CBPS Disclosure Pronouncement; and (b) the metrics that the entity uses to measure and monitor:
(i) this sustainability-related risk or opportunity; and (ii) its performance with regard to this sustainability-related risk or opportunity, including progress towards any targets that the entity has set, and any targets whose compliance is required by law or regulation.

47 In the absence of a CBPS Disclosure Pronouncement that applies specifically to a sustainability-related risk or opportunity, the entity shall apply items 57–58 to identify the applicable metrics.

48 The metrics disclosed by an entity applying items 45–46 shall include metrics associated with specific business models, activities, or other common characteristics of participation in a sector.

49 If the entity discloses a metric obtained from a source other than the CBPS Disclosure Pronouncements, the entity shall disclose the source and the metric used.

50 If a metric has been developed by the entity, it shall disclose information about:
(a) how the metric is defined, including whether it is derived by adjusting a metric obtained from a source other than the CBPS Disclosure Pronouncements and, if so, which source and how the metric disclosed by the entity differs from the metric specified in that source; (b) whether the metric is an absolute measure, a measure expressed in relation to another metric, or a qualitative measure (such as a red, amber, green – or RAG (red, amber, green) status); (c) whether the metric is validated by a third party and, if so, by whom; and (d) the method used to calculate the metric and the data for the calculation, including the limitations of the method used and significant assumptions made.

51 The entity shall disclose information about the targets it has set to monitor progress towards achieving its strategic objectives, and any targets whose compliance is required by law or regulation. For each target, the entity shall disclose:
(a) the metric used to set the target and monitor progress towards achieving it;

(b) the specific quantitative or qualitative target that the entity has set or is required to meet; (c) the period during which the target is applicable; (d) the base period from which progress is measured; (e) any milestones and interim targets; (f) the performance of each target and an analysis of trends or changes in the entity’s performance; and (g) any changes to the target and an explanation of these changes.

52 The definition and calculation of metrics, including metrics used to set the entity’s targets and monitor progress towards achieving them, shall be consistent over time. If a metric is redefined or replaced, the entity shall apply item B52.

53 The entity shall classify and define metrics and targets using significant, clear, and precise names and descriptions.

General Requirements

Sources of Guidance

Identification of risks and opportunities related to sustainability

54 When identifying risks and opportunities related to sustainability that could reasonably affect the entity’s prospects, it shall apply the CBPS Disclosure Pronouncements.

55 In addition to the CBPS Disclosure Pronouncements:
(a) the entity shall consult and consider the applicability of disclosure topics in the SASB (Sustainability Accounting Standards Board) Standards. The entity may conclude that the disclosure topics in the SASB Standards are not applicable in the entity’s circumstances. (b) the entity may consult and consider the applicability of:
(i) the CDSB (Climate Disclosure Standards Board) Framework Implementation Guidance for water-related disclosures and the CDSB Framework Implementation Guidance for biodiversity-related disclosures (collectively referred to as “CDSB Framework Implementation Guidance”); (ii) the most recent pronouncements of other regulatory bodies whose requirements are intended to meet the information needs of users of general purpose financial reports; and

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(iii) the risks and opportunities related to sustainability identified by entities that operate in the same sector(s) or geographic region(s).
Identification of applicable disclosure requirements 56 When identifying the applicable disclosure requirements regarding a sustainability-related risk or opportunity that could reasonably affect the entity’s prospects, the entity shall apply the CBPS Sustainability Disclosure Pronouncement that specifically applies to that sustainability-related risk or opportunity. 57 In the absence of a CBPS Sustainability Disclosure Pronouncement that specifically applies to a sustainability-related risk or opportunity, the entity shall apply judgment to identify information that:
(a) is relevant to the decision-making needs of users of general-purpose financial reports; and (b) faithfully represents that sustainability-related risk or opportunity.
58 When making the judgment described in paragraph 57:
(a) the entity shall consult and consider the applicability of metrics associated with disclosure topics included in the SASB Standards. The entity may conclude that the metrics specified in the SASB Standards are not applicable in the entity’s circumstances. (b) the entity may – to the extent that these sources do not conflict with the CBPS Sustainability Disclosure Pronouncements – consult and consider the applicability of:
(i) the CDSB Framework Application Guidance;
(ii) the most recent pronouncements of other standard-setting bodies whose requirements are intended to meet the information needs of users of general-purpose financial reports; and (iii) information, including metrics, disclosed by entities that operate in the same sector(s) or geographic region(s). (c) the entity may – to the extent that these sources assist the entity in meeting the objective of this Standard (see paragraphs 1–4) and do not conflict with the CBPS Sustainability Disclosure Pronouncements – consult and consider the applicability of the sources specified in Appendix C. Disclosure of information about sources of guidance 59 The entity shall identify:
(a) the standards, pronouncements, industry practices, and other specific sources of guidance that the entity applied in preparing its sustainability-related financial disclosures, including, if applicable, the identification of disclosure topics in the SASB Standards; and

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(b) the sector(s) specified in the CBPS Sustainability Disclosure Pronouncements, the SASB Standards, or other sector-specific guidance sources that the entity applied in preparing its sustainability-related financial disclosures, including in the identification of applicable metrics. Location of disclosures 60 The entity shall provide disclosures required by the CBPS Sustainability Disclosure Pronouncements as part of its general-purpose financial reports. 61 Subject to any regulations or other requirements that apply to the entity, there are various locations in its general-purpose financial reports where sustainability-related financial information can be disclosed. Sustainability-related financial disclosures may be included in the entity’s management commentary or a similar report when this is part of the entity’s general-purpose financial reports. The management commentary or a similar report is a report required in many jurisdictions. It may be known by various names or included in reports with various names, such as ‘management report’, ‘management discussion and analysis’, ‘operational and financial review’, ‘integrated report’, or ‘strategic report’. 62 The entity may disclose information required by a CBPS Sustainability Disclosure Pronouncement in the same location as information disclosed to meet other requirements, such as information required by regulators. The entity shall ensure that sustainability-related financial disclosures are clearly identifiable and are not obscured by this additional information (see paragraph B27). 63 Information required by a CBPS Sustainability Disclosure Pronouncement may be included in sustainability-related financial disclosures by cross-referencing another report published by the entity. If the entity includes information by cross-referencing, the entity shall apply the requirements provided in paragraphs B45-B47. Timing of reporting 64 The entity shall present its sustainability-related financial disclosures at the same time as its respective financial statements. The entity’s sustainability-related financial disclosures shall cover the same reporting period as the respective financial statements. 65 Generally, the entity prepares sustainability-related financial disclosures for a 12-month period. However, for practical reasons, some entities prefer to present, for example, reporting for a 52-week period. This Standard does not prohibit this practice. 66 When the entity changes the closing date of its reporting period and provides sustainability-related financial disclosures for a period longer or shorter than 12 months, it shall disclose:
(a) the period covered by the sustainability-related financial disclosures; (b) the reason for using a longer or shorter period; and

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(c) the fact that the values presented in the sustainability-related financial disclosures are not fully comparable.
67 If, after the end of the reporting period but before the date that the issuance of sustainability-related financial disclosures is authorized, the entity receives information about conditions existing at the end of the reporting period, it shall update the disclosures referring to those conditions in light of the new information. 68 The entity shall disclose information about transactions, other events, and conditions that occur after the end of the reporting period but before the date that the issuance of sustainability-related financial disclosures is authorized, if non-disclosure of this information could reasonably influence the decisions that the primary users of general-purpose financial reports make based on these reports. 69 This Standard does not determine which entities should provide interim sustainability-related financial disclosures, how frequently, or within what time after the end of an interim period. However, governments, securities regulators, stock exchanges, and accounting bodies may require entities whose debt or equity instruments are publicly traded to publish general-purpose interim financial reports. If the entity is required or chooses to publish interim sustainability-related financial disclosures in accordance with the CBPS Sustainability Disclosure Pronouncements, it shall apply paragraph B48. Comparative information 70 Unless another CBPS Sustainability Disclosure Pronouncement permits or requires otherwise, the entity shall disclose comparative information relating to the prior period for all values disclosed in the reporting period. If this information is relevant to understanding the sustainability-related financial disclosures of the reporting period, the entity shall also disclose comparative information for sustainability-related narrative and descriptive financial information (see paragraphs B49-B59). 71 The values reported in sustainability-related financial disclosures may relate, for example, to metrics and targets or to current and predicted financial effects of sustainability-related risks and opportunities. Compliance statement 72 The entity whose sustainability-related financial disclosures comply with all the requirements of the CBPS Sustainability Disclosure Pronouncements shall make an explicit and unreserved statement of compliance. The entity shall not describe its sustainability-related financial disclosures as complying with the CBPS Sustainability Disclosure Pronouncements unless they comply with all the requirements of the Disclosure Standards. 73 This Standard exempts the entity from disclosing information in another manner required by a CBPS Sustainability Disclosure Pronouncement if any specific law or regulation prohibits the entity from disclosing this information (see paragraph B33). This Standard also exempts the entity from disclosing information about a sustainability-related opportunity otherwise required by a CBPS Sustainability Disclosure Pronouncement if this information is
commercially sensitive, as described in this Standard (see paragraphs B34–B37). An entity that uses these exemptions is not prevented from asserting compliance with the CBPS Sustainability Disclosure Pronouncements. Judgments, uncertainties, and errors Judgments 74 The entity shall disclose information to enable users of general-purpose financial reports to understand the judgments, other than those involving estimates of amounts (see paragraph 77), that the entity made in the process of preparing its sustainability-related financial disclosures and that have the most significant effect on the information included in these disclosures. 75 In the process of preparing sustainability-related financial disclosures, the entity makes various judgments, other than those involving estimates, that may significantly affect the information contained in the entity’s sustainability-related financial disclosures. For example, the entity makes judgments about:
(a) identifying climate-related risks and opportunities that could reasonably affect the entity’s prospects; (b) determining which sources of guidance to apply in accordance with paragraphs 54–58; (c) identifying material information to be included in sustainability-related financial disclosures; and (d) assessing whether an event or change in circumstances is significant and requires a reassessment of the scope of all sustainability-related risks and opportunities affected throughout the entity’s value chain (see paragraph B11). 76 Other CBPS Sustainability Disclosure Pronouncements may require the disclosure of some of the information that the entity would otherwise be required to disclose in accordance with paragraph 74. Measurement uncertainty 77 The entity shall disclose information to enable users of general-purpose financial reports to understand the most significant uncertainties affecting the values reported in its sustainability-related financial disclosures. 78 The entity shall:
(a) identify the disclosed values that are subject to a high level of measurement uncertainty; and (b) with respect to each value identified in paragraph 78(a), disclose information about:

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(i) the sources of measurement uncertainty – for example, the value depends on the outcome of a future event, a measurement technique, or the availability and quality of data from the entity’s value chain; and (ii) the assumptions, approximations, and judgments that the entity made in measuring the value. 79 When values reported in sustainability-related financial disclosures cannot be measured directly and can only be estimated, measurement uncertainty arises. In some cases, an estimate involves assumptions about possible future events with uncertain outcomes. The use of reasonable estimates is an essential part of preparing sustainability-related financial disclosures and does not detract from the usefulness of the information if the estimates are accurately described and explained. Even a high level of measurement uncertainty does not necessarily prevent this estimate from providing relevant information. 80 The requirement in paragraph 77, for the entity to disclose information about uncertainties affecting the values reported in sustainability-related financial disclosures, refers to estimates that require more difficult, subjective, or complex judgments by the entity. As the number of variables and assumptions increases, these judgments become more subjective and complex, and the uncertainty affecting the values reported in sustainability-related financial disclosures increases proportionally. 81 The type and extent of information that the entity may need to disclose vary according to the nature of the value reported in sustainability-related financial disclosures – the sources and factors contributing to uncertainty and other circumstances. Examples of the type of information that the entity may need to disclose are:
(a) the nature of the assumption or other source of measurement uncertainty; (b) the sensitivity of the disclosed value to the methods, assumptions, and estimates underlying its calculation, including the reasons for the sensitivity; (c) the expected resolution of an uncertainty and the range of reasonably possible outcomes for the disclosed value; and (d) an explanation of changes made to previous assumptions regarding the disclosed value, if the uncertainty remains unresolved. 82 Other CBPS Sustainability Disclosure Pronouncements may require the disclosure of some of the information that the entity would otherwise be required to disclose in accordance with paragraphs 77–78. Errors 83 The entity shall correct material errors from prior periods by restating the comparative values of the previously disclosed period(s), unless this is impracticable. 84 Prior period errors are omissions and misstatements in the entity’s sustainability-related financial disclosures relating to one or more prior periods. These errors arise from a failure to use, or the misuse of, reliable information that:
(a) was available when the issuance of sustainability-related financial disclosures for these period(s) was authorized; and (b) could reasonably have been obtained and considered in the preparation of these disclosures.
85 Error corrections are differentiated from changes in estimates. Estimates are approximations that the entity may need to revise as additional information becomes known.
86 If the entity identifies a material error in its sustainability-related financial disclosures of prior periods, it shall apply paragraphs B55–B59.

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Appendix A
Definition of Terms
This appendix is an integral part of CBPS 01 and has the same authority as the other parts of the Standard. business model The entity’s system for transforming inputs into outputs and outcomes, through its activities, and which aims to fulfill the entity’s strategic purposes and create value for the entity, and therefore generate cash flows in the short, medium, and long term. disclosure topic A specific sustainability-related risk or opportunity based on activities conducted by entities within a specific sector, as established in a CBPS Sustainability Disclosure Pronouncement or a SASB Standard. general-purpose financial reports Reports that provide financial information about the reporting entity that are relevant to the primary users in making decisions related to the provision of resources to the entity. These decisions involve decisions about:
(a) buying, selling, or holding equity and debt instruments; (b) providing or lending loans and other forms of credit; or (c) exercising voting rights or otherwise influencing the actions of the entity’s management that affect the use of the entity’s economic resources. General-purpose financial reports include – but are not limited to – general-purpose financial statements and the entity’s sustainability-related financial disclosures. CBPS Sustainability Disclosure Standards Standards with this name issued by the International Sustainability Standards Board and translated by CBPS. impracticable The application of a requirement is impracticable when the entity cannot apply it after making every reasonable effort to apply it. material information In the context of sustainability-related financial disclosures, information is material if omitting, misstating, or obscuring this information could reasonably influence the decisions that the primary users of general-purpose financial reports make based on these reports, which include financial statements and sustainability-related financial disclosures and that provide information about the specific reporting entity. primary users of general-purpose financial reports Investors, lending creditors, and other creditors, existing and potential. reporting entity The entity that is required to, or chooses to, prepare general-purpose financial statements. scenario analysis A process to identify and assess a potential series of outcomes of future events under conditions of uncertainty. sustainability-related financial disclosures A particular form of general-purpose financial reports that provide information about the reporting entity’s sustainability-related risks and opportunities, which could reasonably affect the entity’s cash flows, access to financing, or cost of capital in the short, medium, or long term, including information about the entity’s governance, strategy, and risk management regarding these risks and opportunities, and related metrics and targets. users of general-purpose financial reports See primary users of general-purpose financial reports. This definition describes the same population. value chain The full range of interactions, resources, and relationships related to the reporting entity’s business model and the external environment in which it operates. A value chain encompasses the interactions, resources, and relationships that the entity uses and depends on to create its products or services from conception to delivery, consumption, and end of life cycle, including interactions, resources, and relationships in the entity’s operations, such as human resources; in its supply, marketing, and distribution channels, such as supply of materials and services, and sale and delivery of products and services; and in the financial, geographic, geopolitical, and regulatory environments in which the entity operates.

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Appendix B
Application Guidance
This appendix is an integral part of CBPS 01 and has the same authority as the other parts of the Standard.
Sustainability-related risks and opportunities (items 11–12) B1 This Standard requires the entity to disclose information about sustainability-related risks and opportunities that could reasonably affect the entity’s cash flows, its access to finance or cost of capital in the short, medium or long term (referred to as “sustainability-related risks and opportunities that could reasonably affect the entity’s prospects”) (see item 3). B2 The entity’s sustainability-related risks and opportunities arise from the interactions between the entity and its stakeholders, society, the economy and the natural environment throughout the entity’s value chain. These interactions – which may be direct and indirect – result from the operation of the entity’s business model in pursuit of its strategic purposes and the external environment in which it operates. These interactions occur within an interdependent system in which the entity depends on both resources and relationships throughout its value chain to generate cash flows and that affects those resources and relationships in all its activities and outcomes – contributing to the preservation, regeneration and development of those resources and relationships or to their degradation and depletion. These dependencies and impacts may give rise to sustainability-related risks and opportunities that could reasonably affect the entity’s cash flows, its access to finance and cost of capital in the short, medium and long term. B3 For example, if the entity’s business model depends on a natural resource – such as water – the entity may affect and be affected by the quality, availability and accessibility of that resource. Specifically, the degradation or depletion of that resource – including resulting from the entity’s own activities and other factors – could create a risk of disruption to the entity’s operations and affect the entity’s business model or strategy and could, ultimately, adversely affect the entity’s statement of profit or loss and balance sheet. On the other hand, the regeneration and preservation of that resource – including resulting from the entity’s own activities and other factors – could positively affect the entity. Similarly, if the entity operates in a highly competitive market and needs a highly specialized workforce to achieve its strategic objectives, the entity’s future success will likely depend on its ability to attract and retain that resource. At the same time, that ability will depend, in part, on the entity’s employment practices – such as whether the entity invests in employee training and well-being – and on employee satisfaction, engagement and retention levels. These examples illustrate the close relationship between the value the entity creates, preserves or depletes for others and the entity’s own ability to succeed and achieve its objectives. B4 The resources and relationships on which the entity depends and that are affected by its activities and outcomes may take various
forms, such as natural, manufactured, intellectual, human, social or financial. They may be internal – such as the entity’s workforce, its know-how or its organizational processes – or external – such as materials and services that the entity needs to access or the relationships it has with suppliers, distributors and customers. Furthermore, resources and relationships include, but are not limited to, resources and relationships recognized as assets in the entity’s financial statements.

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B5 The entity’s dependencies and impacts are not limited to the resources with which the entity directly engages and the entity’s direct relationships. These dependencies and impacts also refer to resources and relationships throughout the entity’s value chain. For example, they may relate to the entity’s supply and distribution channels; to the effects of consumption and disposal of the entity’s products; and to the entity’s sources of finance and its investments, including investments in associates and joint ventures. If the entity’s business partners throughout its value chain face sustainability-related risks and opportunities, the entity may be exposed to their own consequences. Identification of sustainability-related risks and opportunities B6 The entity shall use all reasonable and verifiable information available at the reporting date, without undue cost or effort (see items B8–B10), to:
(a) identify sustainability-related risks and opportunities that could reasonably affect the entity’s prospects; and (b) determine the scope of its value chain, including its breadth and composition, with respect to each of these sustainability-related risks and opportunities. B7 When identifying sustainability-related risks and opportunities that could reasonably affect its prospects, the entity shall apply the requirements regarding sources of guidance set out in items 54–55. Reasonable and verifiable information B8 The reasonable and verifiable information used by the entity in preparing its sustainability-related financial disclosures shall encompass entity-specific factors as well as general conditions in the external environment. In some cases – such as when identifying sustainability-related risks and opportunities that could reasonably affect the entity’s prospects – reasonable and verifiable information includes information about past events, current conditions and forecasts of future conditions. Other CBPS Sustainability Disclosure Pronouncements may specify what is reasonable and verifiable information in specific cases. B9 The entity may use various internal and external data sources. Possible data sources include the entity’s risk management processes; industry and competitor experience; and external ratings, statistics and reports. Information used by the entity in preparing its financial statements, operating its business model, defining its strategy and managing its risks and opportunities is considered available to the entity without undue cost or effort. B10 The entity is not required to conduct an exhaustive search for information to identify sustainability-related risks and opportunities that could reasonably affect the entity’s prospects. The assessment of what constitutes undue cost or effort depends on the entity’s specific circumstances and requires a balanced consideration of the costs and efforts for the entity and the benefits of the resulting information for primary users. This assessment may change over time as circumstances change.

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Reassessment of the scope of sustainability-related risks and opportunities throughout the value chain B11 In the event of a significant event or significant change in circumstances, the entity shall reassess the scope of all sustainability-related risks and opportunities affected throughout its value chain. A significant event or significant change in circumstances may occur without the entity being involved in that event or change in circumstances or as a result of a change in what the entity assesses to be important for users of general purpose financial reporting. For example, these significant events or significant changes in circumstances may include:
(a) a significant change in the entity’s value chain (for example, a supplier in the entity’s value chain makes a change that significantly alters the supplier’s greenhouse gas emissions); (b) a significant change in the entity’s business model, activities or corporate structure (for example, a merger or acquisition that expands the entity’s value chain); and (c) a significant change in the entity’s exposure to sustainability-related risks and opportunities (for example, a supplier in the entity’s value chain is affected by the introduction of new regulation that the entity had not anticipated). B12 The entity is permitted, but not required, to reassess the scope of any sustainability-related risk or opportunity throughout its value chain more frequently than required by item B11. Materiality (items 17–19) B13 Item 17 requires the entity to disclose material information about sustainability-related risks and opportunities that could reasonably affect the entity’s prospects. The materiality of information is judged considering whether the omission, misstatement or obscuring of information could reasonably influence the decisions of primary users of general purpose financial reporting, who provide information about the specific reporting entity. B14 Primary users’ decisions relate to the provision of resources to the entity and involve decisions about:
(a) buying, selling or holding equity and debt instruments; (b) providing or settling loans and other forms of credit; or (c) exercising voting rights or, otherwise, influence over the actions of the entity’s management that affect the use of the entity’s economic resources. B15 The decisions described in item B14 depend on primary users’ expectations of returns, for example, dividend payments, principal and interest payments or increases in market prices. These expectations depend on primary users’ assessment of the amount, timing and uncertainty of future net cash inflows to the entity and their assessment of management’s stewardship of the entity’s economic resources by its management and its governing body(ies) or individual(s). B16 Assessing whether information could reasonably influence the decisions made by primary users requires consideration of the characteristics of those users and the entity’s own circumstances. B17 Sustainability-related financial disclosures are prepared for primary users who have reasonable knowledge of business and economic activities and who review and analyze information with diligence. Sometimes, even well-informed and diligent users may need to seek the assistance of a consultant to understand sustainability-related financial information. B18 Individual primary users may have different and sometimes conflicting information needs and interests. Primary users’ information needs may also evolve over time. Sustainability-related financial disclosures are intended to satisfy the common information needs of primary users. Identification of material information B19 Materiality judgments are entity-specific. Consequently, this Standard does not specify materiality thresholds nor predetermine what would be material in a particular situation. B20 To identify material information about a sustainability-related risk or opportunity, the entity shall apply, as a starting point, the requirements of the CBPS Sustainability Disclosure Pronouncement that applies specifically to that sustainability-related risk or opportunity. In the absence of a CBPS Sustainability Disclosure Pronouncement that applies specifically to a sustainability-related risk or opportunity, the entity shall apply the requirements regarding sources of guidance specified in items 57–58. These sources specify information, including metrics, that may be relevant for a given sustainability-related risk or opportunity, for a given sector or in specific circumstances. B21 The entity shall assess whether the information identified in applying item B20, individually or in combination with other information, is material in the context of the entity’s sustainability-related financial disclosures considered as a whole. When assessing whether information is material, the entity shall consider quantitative and qualitative factors. For example, the entity may consider the magnitude and nature of the effect of a sustainability-related risk or opportunity on the entity.
B22 In some cases, CBPS Sustainability Disclosure Pronouncements require disclosure of information about possible future events with uncertain outcomes. When judging whether information about these possible future events is material, the entity shall consider:
(a) the potential effects of the events on the amount, timing and uncertainty of the entity’s future cash flows in the short, medium and long term (referred to as “the possible outcome”); and (b) the range of possible outcomes and the probability of the possible outcomes within that range. B23 When considering possible outcomes, the entity shall consider all relevant facts and circumstances. Information about a possible future event is more likely to be considered material if the potential effects are significant and it is probable that the event will occur. However, the entity shall also

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(a) material information is not clearly differentiated from additional information that is not material; (b) material information is disclosed in the sustainability-related financial disclosures, but the wording used is vague or unclear; (c) material information about a sustainability-related risk or opportunity is dispersed throughout the sustainability-related financial disclosures; (d) different information is aggregated inappropriately; (e) similar information is disaggregated inappropriately; and

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(f) the understandability of sustainability-related financial disclosures is reduced as a result of material information being obscured by immaterial information to the extent that a primary user is unable to determine which information is material. B28 The entity shall reassess its materiality judgments each reporting cycle to take into account changed circumstances and assumptions. Due to changes in the entity’s individual circumstances, or in the external environment, some types of information included in the entity’s sustainability-related financial disclosures for prior periods may no longer be material. On the other hand, some types of information not previously disclosed may become material. Aggregation and disaggregation B29 When the entity applies the CBPS Sustainability Disclosure Pronouncements, it shall consider all facts and circumstances and decide how to aggregate and disaggregate information in its sustainability-related financial disclosures. The entity shall not reduce the understandability of its sustainability-related financial disclosures by obscuring material information with immaterial information or aggregating material information that is different from one another. B30 The entity shall not aggregate information if it obscures material information. Information shall be aggregated if it has shared characteristics and shall not be aggregated if it does not have shared characteristics. The entity may need to disaggregate information about sustainability-related risks and opportunities, for example, by geographic location or taking into account the geopolitical environment. For example, to ensure that material information is not obscured, the entity may need to disaggregate information about its water use to distinguish between water extracted from abundant sources and water extracted from areas with water stress. Interaction with law or regulation B31 A law or regulation may specify requirements for the entity to disclose sustainability-related information in its general purpose financial reports. In these circumstances, the entity is permitted to include in its sustainability-related financial disclosures information to meet legal or regulatory requirements, even if that information is not material. However, that information shall not obscure material information. B32 The entity shall disclose material sustainability-related financial information, even if the law or regulation permits the entity not to disclose that information. B33 The entity is not required to disclose information required by a CBPS Sustainability Disclosure Pronouncement if the law or regulation prohibits the entity from disclosing that information. If the entity omits material information for this reason, it shall identify the type of information not disclosed and explain the source of the restriction. Commercially sensitive information B34 If the entity determines that information about a sustainability-related opportunity is commercially sensitive in
the limited circumstances described in item B35, the entity is permitted to omit that information from its sustainability-related financial disclosures. That omission is

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B35 An entity qualifies for the exemption specified in paragraph B34 if, and only if:
(a) the information about the sustainability-related opportunity is not yet publicly available; (b) disclosing that information could seriously prejudice the economic benefits that the entity would otherwise be able to obtain in pursuing the opportunity; and (c) the entity has determined that it is impossible to disclose that information in a way – for example, in an aggregated manner – that would allow the entity to meet the objectives of the disclosure requirements without seriously prejudicing the economic benefits that the entity would otherwise be able to obtain from the opportunity.

B36 If an entity elects to use the exemption specified in paragraph B34, it shall, for each item of information omitted:
(a) disclose that it has used the exemption; and (b) reassess, at each reporting date, whether the information is eligible for the exemption.

B37 An entity is prohibited from using the exemption specified in paragraph B34 with respect to a sustainability-related risk or as a broad basis for not disclosing sustainability-related financial information.

Reporting entity (paragraph 20)

B38 Paragraph 20 requires that an entity’s sustainability-related financial disclosures be from the same entity that reports the corresponding financial statements. For example, consolidated financial statements prepared in accordance with IFRS Accounting Standards provide information about the parent and its subsidiaries as a single reporting entity. Consequently, the entity’s sustainability-related financial disclosures shall enable users of general purpose financial reporting to understand the effects of sustainability-related risks and opportunities on the parent’s and its subsidiaries’ cash flows, access to finance and cost of capital in the short, medium and long term.

Connected information (paragraphs 21–24)

B39 Paragraph 21 requires an entity to provide information in a way that enables users of general purpose financial reporting to understand the connections between the items to which the information refers and between the disclosures provided by the entity in its general purpose financial reports.

B40 Connected information provides information about connections between the items to which the information refers. For example:

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(a) if the entity pursued a specific sustainability-related opportunity and that resulted in an increase in the entity’s revenue, the connected information would describe that relationship between the entity’s strategy and its statement of profit or loss; (b) if the entity identified a trade-off between two sustainability-related risks to which it is exposed and took action based on its assessment of that trade-off, the connected information would describe the relationship between those risks and the entity’s strategy; and (c) if the entity committed to a specific sustainability-related target, but that commitment has not yet affected the entity’s statement of financial position or statement of profit or loss because the applicable recognition criteria have not yet been met, the connected information would describe that relationship.

B41 Connected information includes:
(a) connections between various types of information about a specific sustainability-related risk or opportunity, such as:
(i) between disclosures about governance, strategy and risk management; and (ii) between narrative information and quantitative information (including related metrics and targets and information in the corresponding financial statements). (b) between disclosures about various sustainability-related risks and opportunities. For example, if the entity integrates its oversight of sustainability-related risks and opportunities, the entity shall integrate disclosures about governance rather than providing separate disclosures about governance for each sustainability-related risk and opportunity.

B42 Establishing connections between disclosures involves, among other things, providing necessary explanations and cross-references and using consistent data, assumptions and units of measure. When providing connected information, an entity shall:
(a) explain the connections between disclosures clearly and concisely; (b) avoid unnecessary duplication if CBPS Sustainability Disclosure Pronouncements require the disclosure of common information; and (c) disclose information about significant differences between the data and assumptions used in preparing the entity’s sustainability-related financial disclosures and the data and assumptions used in preparing the corresponding financial statements.

B43 For example, when providing connected information, an entity may need to explain the effect or likely effect of its strategy on its financial statements and financial planning, or explain how that strategy relates to the metrics the entity uses to measure progress against targets. Another entity may need to explain how its use of natural resources or changes within its supply chain could amplify or, conversely, reduce its sustainability-related risks and opportunities. The entity may need to link information about its use of natural resources or changes within its supply chain to information about the current or expected financial effects on the entity’s production costs, its strategic response to mitigate those risks and its

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B44 Other examples of connected information include:
(a) an explanation of the combined effects of the entity’s sustainability-related risks and opportunities and its strategy on its statement of financial position, statement of profit or loss and cash flows in the short, medium and long term. For example, the entity may face a decrease in demand for its products due to consumer preferences for low-carbon alternatives. The entity may need to explain how its strategic response, for example, the closure of a major factory, could affect its workforce and local communities, and the effect of that closure on the useful life of its assets and on impairment assessments. (b) a description of the alternatives the entity evaluated when defining its strategy in response to its sustainability-related risks and opportunities, including a description of the trade-offs between those risks and opportunities that the entity considered (see paragraph 33(c)). For example, the entity may need to explain the potential effects of its decision to restructure its operations in response to a sustainability-related risk on the future size and composition of the entity’s workforce.

Information included by cross-reference (paragraph 63)

B45 Information required by a CBPS Sustainability Disclosure Pronouncement may be available in another report published by the entity. For example, the information required may be disclosed in the corresponding financial statements. Material information may be included in the entity’s sustainability-related financial disclosures by cross-reference, provided that:
(a) the cross-referenced information is available on the same terms and at the same time as the sustainability-related financial disclosures; and (b) the complete set of sustainability-related financial disclosures is not less understandable with the inclusion of cross-referenced information.

B46 Information included by cross-reference becomes part of the complete set of sustainability-related financial disclosures and shall meet the requirements of CBPS Sustainability Disclosure Pronouncements. For example, they need to be relevant, faithfully representative, comparable, verifiable, timely and understandable. The governing body(s) or individual(s) that authorise(s) general purpose financial reports assume(s) the same responsibility for information included by cross-reference as for information included directly.

B47 If information required by a CBPS Sustainability Disclosure Pronouncement is included by cross-reference:
(a) the sustainability-related financial disclosures shall clearly identify the report in which that information is located and explain how to access that report; and (b) the cross-reference shall relate to a precisely specified part of that report.

B48 In light of timeliness and cost considerations, and to avoid repeating information presented previously, an entity may be required or elect to provide less information at interim dates than it provides in its annual sustainability-related financial disclosures. Sustainability-related interim financial disclosures are intended to provide an update on the most recent complete set of annual sustainability-related financial information disclosures. These disclosures focus on new information, events and circumstances and not on duplicating information presented previously. Although the information provided in sustainability-related interim financial disclosures may be more condensed than in annual sustainability-related financial disclosures, the entity is not prohibited or discouraged from publishing a complete set of sustainability-related financial disclosures, as specified in this Standard, as part of its general purpose interim financial report.

Comparative information (paragraphs 52, 70 and 83–86)

B49 Paragraph 70 requires an entity to disclose comparative information relating to the prior period for all values disclosed in the reporting period.

Metrics

B50 In some cases, the value disclosed for a metric is an estimate. Except as specified in paragraph B51, if an entity identifies new information with respect to the estimated value disclosed in the prior period and the new information provides evidence of circumstances that existed in that period, the entity shall:
(a) disclose an adjusted comparative value that reflects that new information; (b) disclose the difference between the value disclosed in the prior period and the adjusted comparative value; and (c) explain the reasons for the change in the comparative value.

B51 When applying the requirement of paragraph B50, an entity need not disclose an adjusted comparative value if:
(a) it is impracticable (see paragraph B54).
(b) the metric is prospective. Prospective metrics refer to possible future transactions, events and other conditions. An entity is permitted to change a comparative value of a prospective metric if doing so does not involve the use of hindsight.

B52 If an entity redefines or replaces a metric in the reporting period, the entity shall:
(a) disclose an adjusted comparative value, unless that is impracticable; (b) explain the changes; and (c) explain the reasons for those changes, including the reason why the redefined or replaced metric provides more relevant information.

B53 If an entity introduces a new metric in the reporting period, it shall disclose a comparative value for that metric, unless that is impracticable.

B54 Sometimes it is impracticable to change a comparative value to achieve comparability with the reporting period. For example, data may not have been collected in the prior period in a way that would allow the retrospective application of a new definition of a metric and it may be impracticable to recreate the data. If it is impracticable to change a prior period comparative value, the entity shall disclose that fact.

Errors

B55 Paragraph 83 requires an entity to correct material errors from prior periods.

B56 These errors include: the effects of mathematical errors, errors in the application of the definitions of metrics or targets, omissions or misinterpretations of facts, and fraud.

B57 Potential errors of the reporting period discovered in that period are corrected before the authorization of the issuance of the sustainability-related financial disclosures. However, material errors are sometimes not discovered until a subsequent period.

B58 If an entity identifies a material error in its sustainability-related financial disclosures of prior period(s), it shall disclose:
(a) the nature of the error(s) of the prior period(s); (b) the correction, to the extent practicable, for each prior period disclosed; and (c) if correction of the error is impracticable, the circumstances leading to the existence of that condition and a description of how and from when the error was corrected.

B59 When it is impracticable to determine the effect of an error on all prior periods presented, the entity shall restate the comparative information to correct the error from the earliest date practicable.

This appendix is an integral part of CBPS 01 and has the same authority as the other parts of the Standard.

C1 This Standard requires (see paragraph 57) that, in the absence of a CBPS Sustainability Disclosure Pronouncement that applies specifically to a sustainability-related risk or opportunity, an entity shall apply judgement to identify information that:
(a) is relevant to the decision-making needs of users of general purpose financial reporting; and (b) faithfully represents that sustainability-related risk or opportunity.

C2 In making that judgement, an entity may – to the extent that those sources assist the entity in meeting the objective of this Standard (see paragraphs 1–4) and do not conflict with CBPS Sustainability Disclosure Pronouncements – consult and consider the applicability of:
(a) Global Reporting Initiative Standards; and (b) European Sustainability Reporting Standards.

C3 When applying the sources of guidance specified in paragraph C2, an entity shall not obscure material information required by CBPS Sustainability Disclosure Pronouncements (see paragraph B27). If an entity applies the sources of guidance specified in paragraph C2 without applying the requirements of CBPS Sustainability Disclosure Pronouncements, the entity shall not make an explicit and unreserved statement of compliance with CBPS Sustainability Disclosure Pronouncements.

This appendix is an integral part of CBPS 01 and has the same authority as the other parts of the Standard.

Introduction

D1 The Conceptual Framework for Financial Reporting (Conceptual Framework – CPC 00) was issued by the International Accounting Standards Board (IASB). It describes the objective and the concepts that apply to general purpose financial reporting. One of the objectives of the Conceptual Framework is to help the IASB develop Accounting Standards for the preparation of financial statements based on consistent concepts.

D2 Sustainability-related financial disclosures are part of general purpose financial reporting. The qualitative characteristics of the Conceptual Framework therefore apply to sustainability-related financial information. However, the nature of some of the information required to meet the objective of this Standard (see paragraphs 1–4) differs, in some respects, from the information provided in financial statements.

D3 Sustainability-related financial information is useful if it is relevant and faithfully represents what it purports to represent. Relevance and faithful representation are fundamental qualitative characteristics of useful sustainability-related financial information. The usefulness of sustainability-related financial information is enhanced if the information is comparable, verifiable, timely and understandable. Comparability, verifiability, timeliness and understandability are enhancing qualitative characteristics of useful sustainability-related financial information.

Fundamental qualitative characteristics of relevant sustainability-related financial information

Relevance

D4 Relevant sustainability-related financial information is capable of making a difference to the decisions made by the primary users. Information may be capable of making a difference in a decision even if some users choose not to take advantage of it or already have it available from other sources. Sustainability-related financial information is capable of making a difference to the decisions made by users if it has predictive value, confirmatory value or both.

D5 Sustainability-related financial information has predictive value if it can be used as the basis for processes employed by primary users to predict future outcomes. Sustainability-related financial information need not be a prediction or forecast to have predictive value. Sustainability-related financial information with predictive value is employed by primary users to make their own predictions. For example, information about water quality, which may include information about water being polluted, may inform users’ expectations about the entity’s ability to meet local water quality requirements.

D6 Sustainability-related financial information has confirmatory value if it provides feedback (confirms or changes) about previous evaluations.

D7 The predictive value and confirmatory value of sustainability-related financial information are interrelated. Information that has predictive value generally also has confirmatory value. For example, current period information about greenhouse gas emissions, which may be used as the basis for predicting greenhouse gas emissions in future periods, may also be compared with the forecasts about greenhouse gas emissions for the current period made in previous periods. The results of those comparisons may help a user to correct and improve the processes that were used to make those previous forecasts.

Materiality

D8 Information is material if omitting, misstating or obscuring that information could reasonably influence the decisions that the primary users of general purpose financial reporting make on the basis of those reports, which provide information about a specific reporting entity. In other words, materiality is an entity-specific aspect of relevance. The materiality of information is assessed in the context of the entity’s sustainability-related financial disclosures and is based on the nature or magnitude of the item to which the information relates, or both.

Faithful representation

D9 Sustainability-related financial information represents phenomena in words and numbers. To be relevant, information must not only represent relevant phenomena, but also faithfully represent the substance of the phenomena that it purports to represent.

D10 To be a faithful representation, a description must be complete, neutral and accurate. The objective of general purpose financial reporting is to maximise those qualities to the extent possible.

D11 A complete description of a sustainability-related risk or opportunity includes all the material information necessary for primary users to understand that risk or opportunity.

D12 Sustainability-related financial information shall be neutral. A neutral description is one without bias in the selection or disclosure of information. Information is neutral if it is not slanted, weighted, emphasised, under-emphasised or otherwise manipulated to make it more likely that primary users will receive that information in a favourable or unfavourable manner. Neutral information is not information without purpose or without influence on behaviour. On the contrary, useful information is, by definition, capable of making a difference to users’ decisions.

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D13 Some sustainability-related financial information—for example, targets or plans—are aspirations. A neutral discussion of these matters covers both the aspirations and the factors that could prevent the entity from achieving them. D14 Neutrality is supported by the exercise of prudence. Prudence is the exercise of caution when making judgments under conditions of uncertainty. The exercise of prudence means that opportunities are not overstated and risks are not understated. Likewise, the exercise of prudence does not permit the understatement of opportunities or the overstatement of risks. D15 Sustainability-related financial information must be accurate. Information can be accurate without being perfectly precise in all respects. The necessary and achievable precision, and the factors that make information accurate, depend on the nature of the information and the nature of the matters to which it refers. For example, accuracy requires that:
(a) factual information is free from material error; (b) descriptions are accurate; (c) estimates, approximations, and forecasts are clearly identified as such; (d) no material errors are made in the selection and application of an appropriate process for developing an estimate, approximation, or forecast; (e) the statements and data used in developing estimates are reasonable and based on information of sufficient quality and quantity; and (f) information regarding judgments about the future faithfully reflects both those judgments and the information on which they are based. Qualitative characteristics of improvement of relevant sustainability-related financial information D16 The usefulness of sustainability-related financial information is enhanced if it is comparable, verifiable, timely, and understandable. Comparability D17 Decisions made by the primary users of general-purpose financial reports involve choosing between alternatives; for example, selling or holding an investment, or investing in the reporting entity or in another. Comparability is the characteristic that enables users to identify and understand similarities and differences between items. Unlike other qualitative characteristics, comparability does not refer to a single item. A comparison requires at least two items. Information is more useful to users if it is also comparable, that is, if it can be compared with:
(a) information provided by the entity in prior periods; and

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(b) information provided by other entities, especially those with similar activities or operating in the same sector.
D18 Sustainability-related financial disclosures shall be provided in a manner that enhances comparability.
D19 Consistency, although related to comparability, does not have the same meaning. Consistency refers to the use of the same approaches or methods to provide disclosures about the same sustainability-related risks and opportunities from period to period, by both the reporting entity and other entities. Comparability is the objective; consistency helps achieve that objective. D20 Comparability is not uniformity. For information to be comparable, similar things shall look alike and different things shall look different. The comparability of sustainability-related financial information is not improved by making different things look alike, nor is it improved by making similar things look different. Verifiability D21 Verifiability helps provide users with confidence that information is complete, neutral, and accurate. Information is verifiable if it is possible to corroborate the information itself or the data used to derive it. Verifiable information is more useful to primary users than information that is not verifiable. D22 Verifiability means that several experienced, independent observers could reach a consensus, although not necessarily complete agreement, that a specific description is a faithful representation. Quantified information does not need to be a single value estimate to be verifiable. A range of possible values and the associated probabilities can also be verified. D23 Sustainability-related financial information shall be provided in a manner that reinforces its verifiability. Verifiability can be reinforced, for example:
(a) by including information that can be corroborated by comparing it with other information available to primary users about the entity’s business, other companies, or the external environment in which the entity operates; (b) by providing information about the data and calculation methods used to produce estimates or approximations; and (c) by providing information reviewed and approved by the entity’s board of directors, board committees, or equivalent bodies. D24 Some sustainability-related financial information will be presented as explanations or forward-looking information. This information may be supported, for example, by the faithful representation of strategies, plans, and risk analyses based on facts. To help primary users decide whether to use this information, the entity shall describe the underlying assumptions and methods for obtaining the information, as well as other factors that provide evidence that the information reflects the actual plans or decisions taken by the entity. Timeliness D25 Timeliness means having information available to decision-makers in time to be capable of influencing their decisions. Generally, the older the information, the less relevant it will be. However, some information may remain timely long after the end of a reporting period, as, for example, some users may need to identify and evaluate trends. Understandability D26 Sustainability-related financial information must be clear and concise. For sustainability-related financial disclosures to be concise, they must:
(a) avoid generic information, sometimes referred to as 'standardized,' that is not specific to the entity; (b) avoid duplication of information in general-purpose financial reports, including unnecessary duplication of information also provided in the respective financial statements; and (c) use clear language and clearly structured sentences and items. D27 The clearest form a disclosure can take depends on the nature of the information and may include tables, charts, or diagrams, in addition to narrative text. If charts or diagrams are used, additional text or tables may be necessary to avoid obscuring material details. D28 Clarity can be reinforced by distinguishing information about developments in the reporting period from 'permanent' information that remains unchanged or changes little from one period to the next—for example, by separately describing the entity’s sustainability-related governance characteristics and risk management processes that have changed since the previous reporting period. D29 Disclosures are concise if they include only material information. Any immaterial information included shall be provided in a manner that avoids obscuring material information. D30 Some inherent sustainability-related risks and opportunities are complex and may be difficult to present in an easily understandable manner. The entity shall present this information in the clearest possible manner. However, complex information about these risks and opportunities shall not be excluded from general-purpose financial reports to facilitate the understanding of those reports. The exclusion of this information would make those reports incomplete and, therefore, potentially misleading. D31 The integrity, clarity, and comparability of sustainability-related financial information depend on the coherent presentation of all information. For sustainability-related financial information to be coherent, it must be presented in a manner that explains the context and connections between related information. D32 If sustainability-related risks and opportunities identified in one part of the entity’s general-purpose financial reports have implications for information disclosed in other parts, the entity shall include the information necessary for users to assess those implications. D33 Coherence also requires the entity to provide information in a manner that enables users to relate information about their sustainability-related risks and opportunities to the information in the entity’s financial statements.

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Appendix E
Effective date and transition
This appendix is an integral part of CBPS 01 and has the same authority as the other parts of the Standard.
Effective date
E1 The entity shall apply this Standard for annual periods beginning on or after January 1, 2024. Early application is permitted. If the entity applies this Standard early, it shall disclose that fact and apply CBPS 02 Climate-related Disclosures at the same time. E2 For the purposes of applying paragraphs E3–E6, the initial application date is the beginning of the annual reporting period in which the entity first applies this Standard. Transition E3 The entity is not required to provide the disclosures specified in this Standard for any period prior to the initial application date. Consequently, the entity is not required to disclose comparative information in the first annual reporting period in which it applies this Standard. E4 In the first annual reporting period in which the entity applies this Standard, the entity is authorized to present its sustainability-related financial disclosures after publishing its respective financial statements. When applying this transition exemption, the entity shall present its sustainability-related financial disclosures:
(a) at the same time as its next general-purpose interim financial report for the second quarter or first half, if the entity is required to provide that interim report; (b) at the same time as its next general-purpose interim financial report for the second quarter or first half, but within nine months from the end of the annual reporting period in which the entity first applies this Standard, if the entity voluntarily provides that interim report; or (c) within nine months from the end of the annual reporting period in which the entity first applies this Standard, if the entity is not required and does not voluntarily provide a general-purpose interim financial report. E5 In the first annual reporting period in which the entity applies this Standard, the entity is authorized to disclose information only on climate-related risks and opportunities (in accordance with CBPS 02) and, consequently, to apply the requirements of this Standard only to the extent that they relate to the disclosure of information on climate-related risks and opportunities. If the entity uses this transition exemption, it shall disclose that fact.

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E6 If the entity uses the transition exemption provided in paragraph E5:
(a) in the first annual reporting period in which the entity applies this Standard, it will not be required to disclose comparative information on its climate-related risks and opportunities (see paragraph E3); and (b) in the second annual reporting period in which the entity applies this Standard, it will not be required to disclose comparative information on its sustainability-related risks and opportunities, except for its climate-related risks and opportunities.

CVM Resolution No. 217 of October 29, 2024

Lineage: In force