Hannes Matt’s Post

The International Auditing and Assurance Standards Board (IAASB) has now officially approved its International Standard on Sustainability Assurance (ISSA) 5000. The approval of ISSA 5000 is a significant development in the IAASB’s efforts to support the growing need for high-quality sustainability assurance and to reduce the risk of fragmentation. It provides much needed consistency for accountants and assurance practitioners as they navigate the complex world of sustainability disclosures. The standard emphasizes the need for assurance providers to exercise heightened professional skepticism, particularly given the evolving nature of sustainability reporting and the unique challenges of verifying non-financial data. It also enhances transparency in assurance engagements, requiring clear reporting of the scope, methodology, and limitations of the assurance work conducted. The standard applies to all forms of sustainability reporting with varying frameworks used globally, including the International Sustainability Standards Board’s (ISSB) IFRS S1 and IFRS S2 and the Global Reporting Initiative’s standards, and regulatory requirements. The EU is developing its own assurance standard, aligned with ESRS. The CSRD requires the adoption of limited assurance standards by the European Commission by 1 October 2026 at the latest. ISSA 5000 is likely to be a valuable input in that process. Meanwhile, the Committee of European Auditing Oversight Bodies (CEAOB) has issues guidelines to support limited assurance on sustainability reporting compliant with ESRS, the reporting framework mandatory under CSRD. The guidelines can be downloaded here: https://lnkd.in/dzjTTvem ISSA 5000 can be downloaded here: https://lnkd.in/deH2W6cN #getCSRDready, #CSRD, #ESRS, #CSDDD, #ESG, #Strategy, #Governance, #SustainabilityReporting, #Digitalisation, #CleeritESG https://lnkd.in/d5pZdRkX

Sustainability Assurance Initial findings from an FRC study highlight market immaturity, quality inconsistencies and the need for a clear regulatory framework, against a backdrop of increasing demand for sustainability assurance services. (FRC stands for Financial Reporting Council, the UK's independent regulator of auditors, accountants and actuaries. It sets standards, monitors and enforces compliances and sets the UK’s Corporate Governance and Stewardship Codes.) As I discovered, while the study is UK-centric, a lot of information published is highly relevant for other jurisdictions also. The link is: https://lnkd.in/gAE-7XCB #Sustainabilityassurance

New Sustainability Auditing Standards Update The International Auditing and Assurance Standards Board (IAASB) announced the publication of its finalized International Standard on Sustainability Assurance 5000 (ISSA 5000), aimed at establishing a new standard for practitioners in carrying out sustainability #assurance engagements. Companies are increasingly reporting on sustainability and climate-related risks, opportunities and impacts in alignment with new #sustainabilitydisclosure standards and regulatory requirements, including the #EU’s Corporate Sustainability Reporting Directive (#CSRD), and the International Sustainability Standards Board (ISSB) ‘s new IFRS Foundation sustainability standards #S1 and #S2. Many of the new sustainability reporting systems, including the CSRD, require #externalassurance on #sustainabilityreporting. Key features include: - Applicability of the standard for both #limitedassurance and #reasonableassurance engagements -Its ability to work with both traditional materiality, as well as double materiality, which is used in several sustainability reporting frameworks – including the CSRD – with requirements in sustainability reports to include information on both the risks and impact of sustainability issues on an enterprise (traditional #materiality) as well as on the enterprises’ impacts on environment and society (#doublemateriality) The European Commission has asked the Committee of European Auditing Oversight Bodies (#CEAOB) to advise the Commission on how to incorporate ISSA 5000 into CSRD-related requirements. I’ve linked the standard below for anyone interested in reading it in more detail, but feel free to reach out to me if you have any questions! https://lnkd.in/eCJcxgdd

The International Auditing and Assurance Standards Board (IAASB) has introduced the International Standard on Sustainability Assurance (ISSA) 5000. These standards outline the general requirements for sustainability assurance engagements, aiming to enhance trust and confidence in sustainability information. The standard emphasizes a principles-based approach, enabling practitioners to apply professional judgment in their assurance engagements, making it applicable across various sustainability topics and reporting frameworks. The new standard is applicable for both limited and reasonable assurance engagements and is able to work with both traditional materiality as well as double materiality. The standards can be used in several sustainability reporting frameworks to map both the risks and impact of sustainability issues on an enterprise, as well as the enterprises’ impacts on the environment and society. This development will be impacting India’s ESG Regulations (BRSR) with the update in Standard on Sustainability Assurance Engagements (SSAE) frameworks, which were inspired from ISAE 3000 standards.   #esg #esgassurance #sustainabilityreport #brsr #brsrassurance #sustainabilityassurance #climatefinance #ssae #isae https://lnkd.in/gEgWWG7s

FRC launches market study on UK sustainability assurance market. The Financial Reporting Council (FRC) has launched a survey of the UK market for sustainability assurance services. This initial study aims to ensure the efficient functioning of the rapidly expanding market and to enhance the quality of assurance provided over companies’ sustainability reporting. Mark Babington, Executive Director of Regulatory Standards at the FRC, emphasised the growing reliance of investors and stakeholders on companies’ sustainability reporting and the crucial role of robust assurance mechanisms in upholding transparency and high standards. Babington stressed the importance of ensuring that the sustainability assurance market operates effectively, delivering independent assurance without imposing undue costs and burdens on reporting entities. The market study will delve into several key areas, including the choice, quality, and competition in the sustainability assurance market, potential impacts from evolving international regulations, and the interplay between sustainability assurance and statutory audit markets. #xbrl #marketstudy #audit https://lnkd.in/g9WAG_rc

We're encouraged to learn that International Auditing and Assurance Standards Board (IAASB) has approved the ISSA 5000—a global standard that will apply to sustainability information reported across any sustainability topic and prepared under multiple frameworks—in a move that marks a milestone in advancing sustainability assurance.   With the standard set to formally publish by the end of the year, read our alert to learn more about a CPA’s role in third-party assurance over sustainability information. The accountancy profession is well-positioned to provide the assurance required to avoid greenwashing and maintain credibility within sustainability reporting. https://lnkd.in/gfYkChwe

The Financial Reporting Council's market study into sustainability assurance is timely given the likely adoption of sustainability reporting standards sometime in 2025 and early indications that more companies are looking for assurance on their reporting. In Forvis Mazars in the UK's submission to the FRC we highlight our concerns over concentration in the assurance market which, we believe, may reinforce the already high concentration in the audit market, and make comment on drivers of competition and barriers to entry to the assurance market. We also set out we want to see from a sustainability reporting and assurance regulatory framework in the UK including international alignment, early indications of reporting and assurance requirements, competition and the role a managed shared "audit" approach may play and the importance of the role of the FRC in regulation and enforcement. #sustainabilityreporting #sustianabilityassurance #sustainability #regulation

🌍 10 Steps for Successful CSRD Reporting 🌍 As organizations increasingly recognize the importance of sustainability, the Corporate Sustainability Reporting Directive (CSRD) has become a vital component of compliance. Whether your company is just beginning its journey or looking to refine its reporting process, these ten fundamental steps can guide you towards successful CSRD compliance: Scope the Application of the CSRD: Understand how CSRD applies to your organization based on your industry and size. Consider the Level of Disaggregation of Material Information: Determine the granularity needed for reporting material information. Perform the Double Materiality Assessment: Evaluate both the financial and environmental impacts of your activities. Familiarise Yourself with the ESRS: Get to know the European Sustainability Reporting Standards (ESRS) thoroughly. Engage with Your Organisation and Communicate CSRD Requirements with Internal Stakeholders: Ensure that all relevant internal stakeholders are aware and engaged with CSRD requirements. Perform a Data Gap Analysis: Identify any gaps in your current data that need to be addressed for comprehensive reporting. Discuss with Your Auditor: Engage with your auditor early in the process to align on expectations and requirements. Streamline Data Collection and Monitoring: Implement efficient processes for continuous data collection and monitoring. Embed Technology Tools for the Production of the Report: Leverage technology to automate and streamline report production. Ensure Continuous Learning on Latest Sustainable Finance Regulations: Stay updated on the latest regulations and best practices in sustainable finance. By following these steps, your organization can navigate the complexities of CSRD reporting effectively. Let's work together towards a sustainable future! 🌱 #CSRD #Sustainability #ESG #SustainableFinance #CorporateReporting #SustainabilityReporting #Compliance #SustainableBusiness #EnvironmentalImpact #SustainableFuture

In the UK the Financial Reporting Council has just published a report sustainability assurance in the FTSE 350. Some interesting sustainability audit teaching material here andsome important considerations for Irish Auditing & Accounting Supervisory Authority (IAASA) in the Irish jurisdiction. 1️⃣ There appears to be a wide variety and choice of sustainability assurance providers in the UK but there are concerns over the consistency in quality of the assurance. 2️⃣ We have heard from some stakeholders that the UK sustainability assurance market could become dominated by the Big Four audit firms, which could limit choice and effective competition. 3️⃣ There are concerns about the immaturity of the UK sustainability assurance market and that a lack of clarity on the UK’s regulatory position could hinder investment, planning and capacity development. 4️⃣ There could be a risk that without an established regulatory framework, the UK sustainability assurance market may not produce consistent, high-quality sustainability information for decision-making. 👉 https://lnkd.in/d_YQK3DU Christine Nangle FCA, Linda Mc Weeney, Ruth O'Leary, John Brennan, Maurice Barrett

The Canadian Sustainability Standards Board (CSSB) has opened its public consultation (until June 10, 2024) on its proposed Canadian Sustainability Disclosure Standards (CSDS), which are aligned to IFRS S1 & S2 with Canadian-specific considerations. The proposed standards aim to set a new benchmark for the disclosure of sustainability-related information. Access the draft Standards in the link below. Next Steps? ➡ Public consultation open until June 10, 2024 ➡ CSSB to incorporate changes, if required ➡ Canadian Sustainability Disclosure Standards finalized ➡ Potential incorporation into Canadian Securities Administrators rule and legislation, making disclosures mandatory https://lnkd.in/gKgrCsvP