Accounting Standards

Lack of standardization in sustainability assurance, says IFAC

The international body’s recent study found that global practices for sustainability assurance differ depending on jurisdiction

A recent study by the International Federation of Accountants (IFAC), in partnership with the AICPA and CIMA (representing the Association of International Certified Professional Accountants), has found a lack of standardization in sustainability assurance globally.

The international body’s latest study explored the state of assurance practices around the world and found different methods were utilized depending on jurisdiction.

IFAC hopes the study will be used to inform industry thinking of sustainable practices, with low-quality assurance continuing to be an investor protection and financial stability risk.

Kevin Dancy, IFAC’s CEO said: “The global community needs to consider many complex questions—should reporting sustainability information be required? If so, should assurance be required, and by whom?”

“With this new data in hand, IFAC is initiating evidence-based conversations with our member organizations and other global stakeholders to advance the global debate and help plot the way forward in the public interest.”

Susan S. Coffey, CEO of public accounting at the AICPA, said: “Companies that publish sustainability information that is subject to assurance by professional accountants have an opportunity to bring trust and reliability to their sustainability information.

“Engaging a licensed professional accountant who possesses the right combination of professional skills, qualifications, experience and is subject to independence, ethical and monitoring requirements can result in truly meaningful assurance and transparency.”

She added: “As it stands, only around half of the companies reviewed in this study publish sustainability information that is subject to any assurance.”

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