The International Organisation of Securities Commissions (IOSCO) has published its International Work to Develop a Global Assurance Framework for Sustainability-related Corporate Reporting,
The aim is to develop a global assurance framework for sustainability-related corporate reporting.
Through its fact-finding work and engagement with stakeholders internationally, IOSCO has observed growing demand among investors for high-quality assurance and ethics standards for sustainability-related information.
The report discusses the current global regulatory landscape for assurance over sustainability-related information, saying it relies mainly on voluntary use of assurance, and that practices vary widely.
IOSCO builds on its support for the ongoing work of the international standard setters – the International Auditing and Assurance Standards Board (IAASB) and the International Ethics Standards Board for Accountants (IESBA) – to develop profession-agnostic assurance and ethics (including independence) standards over sustainability-related information.
Both standard setters aim to issue exposure drafts in H2 2023, approving the standards in time for the FY 2024 reporting period.
IOSCO is calling on issuers, assurance providers and others across the sustainability reporting ecosystem to engage with the IAASB and IESBA throughout the development of the standards.
Stakeholders are asked to consider ways to enhance the connectivity between sustainability-related information and financial statements, and to help ensure that the global assurance framework promotes a high degree of transparency.
Rodrigo Buenaventura, chair of the Sustainable Finance Task Force, said, “The finalisation of these standards will be an important milestone. But the standards can only deliver on their promise if they are applicable for all assurance providers, irrespective of their profession, and subject to established robust due processes ensuring the development of high-quality standards.”
According to the report, IOSCO’s fact-finding work also identified a need for the entire sustainability reporting ecosystem to enhance its capabilities to support effective assurance over sustainability-related information.
As a result, IOSCO also calls on issuers and assurance providers to build and maintain appropriate knowledge of sustainability-related reporting, and related skills, capabilities, processes and controls to support reporting and assurance.
IOSCO encourages the IAASB and IESBA to support these efforts, also taking account of the needs of emerging markets and other stakeholders that may be less familiar with assurance over sustainability-related information.
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