Two accountancy bodies collaborate on standards for sustainability reporting
January 29th, 2025
The International Auditing and Assurance Standards Board (IASSB) and the International Ethics Standards Board for Accountants (IESB) have published standards and guidance to strengthen sustainability reporting.
The integrated effort sets clear ethical standards for sustainability reporting and assurance, with specific requirements for practitioners and organisations in relation to assurance engagements on sustainability information.
The new standards aim to provide a unified global approach to meet the rising demand for trustworthy sustainability information to support stakeholder decisions.
The standards share five key goals, including establishing a global baseline and levelling the playing field by meeting markets demands and regulatory calls for a profession-agnostic global standard.
They also aim to promote informed decision-making based on trusted, independently assured sustainability information and reduce the risks of fraud, including greenwashing and non-compliance with laws and regulations.
Both standards will become effective for periods on or after December 15, 2026.
The move follows concerns from the Institute of Chartered Accountants of Scotland that the UK government may weaken or abandon parts of the already-delayed corporate governance reforms.
The UK’s Business Secretary Jonathan Reynolds had previously pledged to advance the reforms, with a draft Audit Reform and Corporate Governance bill featured in the King’s Speech in July.
Currently, only members of an accountancy body can be held accountable by the regulator for making incorrect financial statements, however the bill seeks to expand this accountability.
The bill aims to provide more reliable audit information to guide lending and investment decisions, ensuring support for the best credit risks rather than the worst.
However, the government’s push for regulators to prioritise growth over risk has led to delays in the reforms, as stricter auditing requirements were seen as a barrier to growth.
As a result, Scotland’s accountancy board urged the government not to weaken these reforms, warning it could undermine oversight of board decisions and compromise the UK’s high standards.
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Last Updated: 29 January 2025