IAASB Proposes Global Sustainability Assurance Standard

financial analysis on paper and graphs

Image by David Schwarzenberg from Pixabay

by | Aug 3, 2023

financial analysis on paper and graphs

(Credit: Pixabay)

The International Auditing and Assurance Standards Board (IAASB) has proposed new standards for assurance on sustainability reporting.

The new standards, known as the International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements, will be a comprehensive standard for all assurance practitioners across the globe. The IAASB is an independent body that issues standards for auditing, assurance, and quality management.

“Our proposed ISSA 5000 is a crucial step in enhancing confidence and trust in sustainability reporting. This proposal directly responds to the International Organization of Securities Commissions recommendations and complements the work of other standard setters, including the International Ethics Standards Board for Accountants,” noted IAASB Chair Tom Seidenstein. “Corporate reporting, whether financial or sustainability focused, is more trusted when it receives external and independent assurance based upon globally accepted standards independently developed in the public interest.”

The proposed standards come after the International Sustainability Standards Board (ISSB) issued its first-ever standards related to sustainability disclosures by companies. The standards, known as IFRS S1 and IFRS S2, ensure companies provide sustainability-related information alongside financial statements.

The ISSA 5000 aims to create suitable standards for both limited and reasonable assurance engagements on sustainability information across sustainability topics.

The standards were drafted with the intent to work for any sustainability information prepared under any reporting framework, including those already in place and under development. The reporting frameworks considered include those by the European Union, the International Sustainability Standards Board, the Global Reporting Initiative, the International Organization for Standardization, and others, IAASB stated.

The proposed ISSA 5000 will be available in many languages in the coming weeks, with IAASB asking for stakeholder comment by Dec. 1, 2023. IAASB will conduct four roundtables beginning in September to ensure stakeholder outreach, as well as participate in virtual, regional, and national events throughout the consultation period.

“Receiving the broadest range of views from our stakeholders will improve both the quality of and trust in the final standard. Our unprecedented commitment to outreach will allow us to engage directly with a much wider group of stakeholders to gather the valuable insights we need to finalize a high-quality robust standard,” IAASB Vice-Chair and Sustainability Task Force Chair Josephine Jackson said in a statement.

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