Status: Will be live at 09/12/2025 05:45
On September 11, the IIF submitted a letter the ISO on its consultation on “ISO/DIS 32212 Sustainable finance — Net zero transition planning for financial institutions”, highlighting key concerns on behalf of the global financial industry relating to the contents of the draft standard, and the process through which it was developed. Key issues include:
- Conceptual foundations: The draft standard rests on the faulty premise that financial institutions can drive real economy outcomes relating to the net zero transition by influencing or controlling client decision-making.
- Unclear necessity and value-add: Many aspects of the transition planning process are inherently subjective and would not be appropriate or beneficial to standardize. It is not clear that the standard delivers added value for financial institutions or other stakeholders.
- Unprecedented and inappropriate proposed requirements: The draft proposes requirements and expectations for the core commercial decisions of financial institutions, which do not reflect industry practices or existing frameworks and guidance. Many of these requirements are not only unprecedented, they are also wholly inappropriate. Furthermore, many of the proposed requirements would be economically inefficient, risk creating distortions, and would create unworkable obligations that would undermine financial institutions’ ability to serve their clients and finance the real economy.
- Lack of meaningful engagement: Financial institutions, the stakeholders most directly impacted by the proposed standard, were not meaningfully consulted or engaged throughout the drafting process. This exclusion undermines the credibility of the standard and raises significant concerns about its practicality.
- Overreach of mandate: It is not evident that it would be within ISO’s mandate as a technical standards body to seek to prescribe how financial institutions design business strategies, allocate capital, manage risks, or engage with clients and policymakers – even through a standard that is positioned as voluntary. In this regard, the global financial industry is concerned that ISO risks undermining regulatory clarity and exacerbating fragmentation at precisely the time when convergence and alignment are most needed.
While positioned as voluntary, financial institutions are concerned that the draft standard could in effect become quasi-mandatory, should it be taken up as a market norm, or referenced in policy. In this regard, the global financial industry considers there to be a significant mismatch between the process that was undertaken to develop the standard and the potentially globally significant implications of its adoption. To support open dialogue, the IIF’s comment letter highlights the critical importance of ensuring that the perspectives of financial institutions as the intended primary users of the standard, are appropriately accounted for.