The International Auditing and Assurance Standards Board (IAASB) has published its proposed International Standard on Sustainability Assurance (ISSA), as part of a consultation which will close in December.
The proposed standards should act as guidelines for regulators globally to ensure compliance consistency across frameworks like the EU's Corporate Sustainability Reporting Directive (CSRD) and the SEC's ESG regulations in the U.S.
"The framework will serve as a stand-alone standard suitable for any sustainability assurance engagement and will apply to sustainability information reported across any sustainability topic and prepared under multiple frameworks," the IAASB clarified.
This includes the recently released IFRS Sustainability Disclosure Standards S1 and S2.
Assurance standards are set internationally. This means that any standards that will be used with CSRD will be adopted from the international standards, explained Andie Wood, vice president for regulatory strategy at reporting compliance consultancy Workiva.
Discussing the new standards with Net Zero Investor, Wood said that “overall, this consultation is a very welcome step in the right direction. The effort to produce a timely result will be appreciated but there is also the pressure to ensure that the result is workable and covers the important aspects of assurance for sustainability information."
She pointed out that "the expectation is that each state, which do all have some kind of relevant body, will specify what approach is to be used until there are [globally] endorsed standards."
Wood stressed, however, that "this leads to a general concern that early assurance procedures might not be all that consistent across countries."
Other concerns are that - without international standards - international companies and multinationals could face issues when as it will be hard to address global sustainability reporting differences, she continued.
“It is worth being aware, however, that despite the benefits a consistent global standard can bring, the proposed standard is focused on principles or outcomes rather than procedures or steps, so there is still plenty of scope for professional judgement and practitioner experience to come into play," Wood concluded.
Stakeholders have until 1 December to provide feedback and insights. The final standards will be issued before the end of 2024.
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