TSRS – Turkish Sustainability Reporting Standards

published on 12 May 2025 I reading time approx. 4 minutes

Global environmental issues such as climate change, biodiversity loss, and increasing risks of drought, as well as social and economic challenges like income inequality, gender-based discrimination, and violations of business ethics, have reached a level that can no longer be ignored by companies. At the same time, public awareness of sustainability has increased worldwide. As a result, companies are under growing pressure to align their business practices with ecological and social expectations and to act transparently.

Against this backdrop, international sustainability reporting standards are gaining importance. The aim is to enhance the transparency, comparability, and reliability of sustainability information through standardized reporting frameworks.

Introduction of the TSRS in Türkiye

With the amendment of Article 88 of the Turkish Commercial Code No. 6102, published in the Official Gazette on June 4, 2022, the Public Oversight, Accounting and Auditing Standards Authority (KGK) was granted the authority to issue national sustainability reporting standards. The resulting Turkish Sustainability Reporting Standards (TSRS) now serve as the mandatory framework for companies subject to reporting requirements.

The TSRS are based on the international standards IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures, developed by the International Sustainability Standards Board (ISSB). The Turkish versions of these standards were published by the Public Oversight, Accounting and Auditing Standards Authority (KGK) to enable companies operating in Türkiye to prepare transparent, comparable, and reliable reports on sustainability-related matters.

Concept of TSRS

The TSRS define key metrics, indicators, and reporting methods that companies are expected to use when disclosing their environmental, social, and economic impacts. The goal is to establish a consistent and comparable level of reporting and to enhance transparency regarding companies’ sustainability performance.

TSRS 1 (“General Requirements for the Disclosure of Sustainability-related Financial Information”) and TSRS 2 (“Climate-related Disclosures”) currently form the foundation of the reporting framework. In addition, 68 sector- and topic-specific standards have been published.

In parallel, the EFRAG published the European Sustainability Reporting Standards (ESRS) on July 31, 2023. These standards apply from 2024 onward to companies subject to the Corporate Sustainability Reporting Directive (CSRD). Although the TSRS and ESRS are based on different regulatory frameworks, significant efforts are underway at the international level to align them and ensure their interoperability. The aim of these efforts is to improve comparability and compatibility between the two standards — including through the development of joint guidance, coordination between standard-setters, and the promotion of a harmonized global reporting framework.

Who is subject to the reporting obligation?

According to the announcement published on January 5, 2024, the TSRS are mandatory for companies that exceed at least two of the following thresholds in two consecutive financial years:

Total assets of 500 million Turkish Lira
Annual net revenue of 1 billion Turkish Lira
Number of employees: 250 or more

These criteria apply to large companies, including publicly listed entities, banks, financial institutions, and other relevant organizations. In addition, certain banks are also required to report under the Turkish Banking Law No. 5411, provided they are subject to banking supervision — excluding institutions that fall under the Deposit Insurance Fund.

It is important to note that companies not subject to the legal reporting obligation may also choose to report voluntarily in accordance with the TSRS — an increasingly common approach to meet investor expectations and international market requirements.

Sustainability Assurance under the TSRS

Sustainability reports prepared under the TSRS are subject to mandatory assurance by independent auditors, provided that the reporting company falls within the scope of the mandatory application. This assurance ensures that the information contained in the report complies with the applicable standards and is accurate, complete, and reliable.

The assurance process goes beyond a mere formal review of disclosures; it also covers the traceability of the applied methodologies, the consistency of the data used, and the transparency of the reporting processes.

The KGK, as the regulatory authority, is responsible for qualifying, evaluating, and authorizing auditors who are able to conduct sustainability assurance engagements. To ensure that these audits are carried out by professionally competent independent auditors, the KGK published the key content areas and requirements for auditors in its announcement dated June 28, 2024.

The first official qualification exam to obtain the authorization for conducting sustainability assurance engagements was held on September 21, 2024. This development is a significant step toward the professionalization and systematization of sustainability assurance in Türkiye.

In the long term, these assurance processes are expected to enhance the quality of reporting, promote accountability, and increase market transparency. Companies that proactively prepare for these processes not only ensure regulatory compliance but also strengthen their credibility with all stakeholders.

Conclusion

Sustainability reporting is increasingly becoming a core component of corporate accountability worldwide. While it is formally referred to as “non-financial reporting,” its impact on company value and stakeholder trust is increasingly comparable to that of traditional financial metrics.

With the introduction of the TSRS, Türkiye is actively positioning itself within the international sustainability discourse and calling on companies to assume responsibility in a transparent and structured manner. Businesses that act early not only enhance their compliance but also strengthen their competitiveness in the global arena.