Philippines Launches Mandatory IFRS-Based Sustainability Reporting Standards

The Philippine Securities and Exchange Commission announced the adoption of mandatory sustainability and climate reporting standards based on internationally recognised IFRS Sustainability Disclosure Standards. The new set of standards - locally referred to as Philippine Financial Reporting Standards (PFRS) on Sustainability Disclosures - will form the foundation for mandatory reporting requirements for large and listed companies in the Philippines over the next few years.

According to the Commission, the PFRS sustainability standards include PFRS S1 and PFRS S2, which correspond to the IFRS Foundation’s general sustainability and climate-related reporting standards, respectively. These standards are now intended to enable Philippine companies to prepare and submit sustainability reports that are aligned with global best practices, facilitating transparency, comparability and accountability in corporate sustainability disclosures.

The rollout of the new reporting requirements will follow a tiered approach. Under this schedule, publicly listed companies with a market capitalisation of at least PHP 50 billion (approximately USD 840 million) must begin sustainability reporting in 2027, covering performance from the 2026 fiscal year.

Companies with a market cap greater than PHP 3 billion but below PHP 50 billion are expected to begin reporting the following year, while all other publicly listed companies and large non-listed firms with annual revenues greater than PHP 15 billion are scheduled to start reporting in 2029, covering fiscal year 2028.

The Commission also highlighted transitional relief measures designed to ease the shift to mandatory reporting. These include allowing companies not to report Scope 3 greenhouse gas emissions for the first two years and providing graduated requirements for the disclosure of climate-related risks and opportunities for different tiers of reporters.

Additionally, entities will be required to obtain independent assurance on Scope 1 and Scope 2 greenhouse gas emissions two years after they begin reporting under the new standards.

The Philippines adopting mandatory IFRS-aligned sustainability standards signals ASEAN convergence on ISSB, and it changes disclosure baselines for corporates operating across the region. Our ESG-strategy and sustainability-due-diligence teams help clients evaluate what ASEAN ISSB adoption means for their reporting infrastructure.