Turkey Sustainability Reporting Standards (TSRS) were announced through an official gazette notification by the Public Oversight, Accounting and Auditing Standards Authority on December 29, 2023.
It was announced that TSRS 1 “General Provisions for Disclosure of Financial Information Related to Sustainability” and TSRS 2 “Climate-related Disclosures,” based on the International Financial Reporting Standards Foundation- IFRS S1 “General Requirements for Disclosure of Sustainability-related Financial Information” and IFRS S2 “Climate-related Disclosures,” will become mandatory from January 1, 2024.
Companies that exceed the threshold values of at least two of the criteria, namely total assets of 500 million Turkish liras, annual net sales revenue of 1 billion Turkish liras, and a workforce of 250 employees, for two consecutive reporting periods, are now obligated to conduct sustainability reporting including TSRS.
During the determination phase of the threshold values, financial statements prepared according to the regulations to which the business is subject will be considered for total assets and annual net sales revenue values, and the average number of employees will be considered for the value of the workforce. Subsidiaries and affiliates of businesses will also be subject to threshold values.
Transition Provisions
According to the board decision regarding TSRS application principles, presenting comparative information is not mandatory in the first reporting period. In the first annual reporting period, companies can conduct sustainability reporting related to TSRS after publishing the financial reports for the relevant reporting period.
In the initial two-year reporting period based on TSRS, disclosure of Scope 3 greenhouse gas emissions has not been made mandatory.
Effective Date
The initial application date will be considered as the beginning of the annual reporting period in which the company first applies TSRS.
Scope of TSRS 1 and TSRS 2
TSRS 1 General Provisions for Disclosure of Financial Information Related to Sustainability
The scope of the standard includes companies’ financial information and disclosures related to sustainability. However, this standard does not include sustainability-related risks and opportunities that are not expected to affect the company’s future financial performance.
TSRS 2 Climate-related Disclosures
The relevant standard will be applied to the physical risks and transition risks related to the climate that companies are exposed to, and opportunities related to the climate that the company owns.
Unless conflicting with TSRS, companies can refer to European Sustainability Reporting Standards- ESRS and GRI Sustainability Standards and assess the applicability of these standards.
Sustainability reporting based on voluntariness until January 1, 2024, has been made a legal requirement for companies that meet at least two threshold values. We would like to note that organizations in need of support for sustainability reporting based on TSRS 1 and TSRS 2 standards can contact the Jurcom Sustainability team at [email protected].
