Building Trust in Sustainability Reporting and Preparing for Assurance: Governance and Controls for Sustainability Information guide highlights how to establish effective governance arrangements and controls to build confidence in sustainability
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To achieve net-zero commitments and climate neutrality requires robust climate transition planning that provides the basis for strategic decision-making, fulfills investors’ reporting needs, and allows asset owners and managers to efficiently allocate capital and mobilize resources.
Jing Zhang, Head of Climate Research, IFRS Foundation
“Making climate a priority is one step at the beginning of a long journey towards achieving net-zero that will be different for each organization,” said IFAC CEO Kevin Dancey. “The professional accountant’s ability to translate risks and opportunities into numbers and actions will be an essential component of developing and achieving climate transition plans necessary to meet critical climate commitments.”
Register now to join the virtual event September 21 at 9am ET. A recording will be available online after the event.
About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.
About A4S
Accounting for Sustainability (A4S) was established by HRH The Prince of Wales in 2004. Our aim is to transform finance to make sustainable business, business as usual.
To deliver useful information for internal decision-making, as well as for comprehensive, trustworthy corporate reporting, businesses can break down functional and information silos with an integrated mindset, bringing together information from corporate functions and external sources about sustainability impacts and related opportunities and risks that are relevant to the value creation process.
Integrated reporting has been adopted as a market-led initiative by thousands of private and public sector organizations around the world to help them understand and communicate their value creation and performance to investors and other stakeholders.
To enhance trust in integrated corporate reporting, boards need to oversee the integrity of the integrated report and underlying reporting process. To help them, IFAC has worked in partnership with the Institute of Internal Auditors (IIA) to develop Executing the Board’s Governance Responsibility for Integrated Reporting—the second installment in IFAC’s integrated reporting assurance series. It highlights how boards execute their accountability responsibility for integrated reporting and integrated reports with the coordination of all lines of governance and the support of internal auditors.
Board responsibility statements incorporate multiple internal assurance activities across all lines of governance and management and support the integrity of the integrated report and the underlying processes, systems, and information. This installment highlights the concepts and tools needed to deliver such statements. These can also be applied to regulated forms of management commentary in many parts of the world, including management discussion and analysis, strategic report, operating and financial review or the Task Force on Climate-Related Financial Disclosures.
“The IFRS Foundation’s announcement on the future of integrated reporting and the International Integrated Reporting <IR> Framework confirms that the International Accounting Standards Board (IASB) and International Sustainability Standards Board (ISSB) will assume responsibility for the <IR> Framework from July,” said Kevin Dancey, IFAC CEO. “Within the IFRS Foundation, the Framework will be further developed to help companies prepare an integrated report and support connectivity between the reporting required by the IASB and the ISSB. This installment of IFAC’s integrated reporting assurance series shows how directors can deliver confidence in integrated reporting through coordinated and connected internal and external assurance activities.”
“As an integral component of effective organizational governance, internal audit plays a critical role in instilling trust and confidence in the completeness, accuracy, and reliability of the information that forms the basis of the organization’s integrated report,” said Anthony Pugliese, CIA, CPA, CGMA, CITP, president and CEO of The IIA. “As noted in the widely accepted Three Lines Model, internal audit provides objective assurance, independent from management, of internal controls critical to achieving organizational objectives, including objectives related to integrated thinking and reporting.”
About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.
About The IIA
Established in 1941, The Institute of Internal Auditors (IIA) is an international professional association with global headquarters in Lake Mary, Florida, USA. The IIA is the internal audit profession's global voice, recognized authority, acknowledged leader, chief advocate, and principal educator. Generally, members work in internal auditing, risk management, governance, internal control, information technology audit, education, and security.
IFAC releases second installment of integrated reporting assurance series
Boards of directors need to oversee multiple internal assurance activities across organizations in discharging their responsibilities for the integrity of integrated reporting.
Accrual-based financial information is the bedrock for decision making, transparency and accountability in the public sector, but transitioning to accrual-based reporting can be a lengthy and arduous process with each jurisdiction undertaking the reforms facing its own unique ch
The report examines the importance of readily available, relevant, and reliable sustainability information for achieving better-informed decisions, enhanced strategic and risk management, and more thorough and valuable reporting to external stakeholders. It also highlights a range of emerging services that practitioners can provide to their clients, including advisory services, reporting, agreed-upon procedures (AUP) engagements, and assurance services.
Small businesses make up more than 90 percent of businesses worldwide; they are critical to achieving sustainable outcomes for economies, the environment and society. They can find significant advantages from establishing (or enhancing) processes, systems and controls for identifying, measuring, and analyzing sustainability information. This can include improved efficiencies and performance, as well as differentiation from competitors.Small businesses are also likely to be subject to sustainability-related reporting information requests from a diverse range of stakeholders, including large companies, banks, and suppliers—if they are not already.
Although focusing on sustainability information and related services may seem premature for some small businesses and practitioners, the field is growing quickly. To speak to different practitioners’ unique circumstances, the publication includes suggestions on building knowledge and competencies and taking initial steps.
IFAC will explore these issues further in a webinar on December 15 titled “Sustainability Offers New Opportunities for SMPs” (with simultaneous translation into Spanish and French). The webinar will feature a panel discussion with practitioners who are providing services in this space.
About IFAC IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.
