IAASB Initiates Engagement Standard for Assurance in Sustainability Reporting

In its Work Plan for 2022-2023, the International Auditing and Assurance Standards Board (IAASB) committed to creating robust standards that support and address sustainability/ESG reporting from an audit and assurance perspective. Assurance engagements for sustainability/environmental, social and governance (ESG) reporting are one of the most important areas of the work plan. In a recent article, Tom Seidenstein, Chairman of the IAASB, explains developments and the IAASB's plans to provide confidence in sustainability reporting.

In June 2022, the IAASB enthusiastically supported the start of work on the development of a “separate” standard for engagements that provide assurance in sustainability reporting.

Recognizing that a standard is in its early stages of development and decisions may change as the development of a standard progresses, the standard will:

• Separate from International Standard for Assurance Engagements (ISAE) 3000 (Revised) "Assurance Engagements Other than Audits and Reviews of Historical Financial Information";
• Consider obtaining both limited and reasonable assurance;
• Developed using the requirements and principles of IPSAS 3000 (Revised), IPSAS 3410 Engagements for Assurance for GHG Emissions Reporting, and unauthorized guidance on the application of IPSAS 3000 (Revised) for assurance engagements for sustainability reporting. development and other Enhanced External Reporting (EER) assignments. In doing so, the requirements and guidance will be expanded and specified to validate sustainability reporting;
• Initially focused on concretization to solve certain priority tasks;
• Be eligible for assurance engagements on all sustainability topics and information on those topics. The standard will be system neutral, and neutral towards users or stakeholders of sustainability information.

In September, the IAASB will review the draft project plan, the draft structure of the standard, the requirements to be incorporated from MSSE 3000 (Revised) and MSSE 3410, and, time permitting, material from the EER Manual to be incorporated into the standard as requirements. The IAASB continues to work with key stakeholders.

Stakeholders can follow the progress of the project by visiting the Sustainability project page.