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IESBA suggests reviewing more stringent ESG reporting guidelines.

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TLDR:

  • The International Ethics Standards Board for Accountants (IESBA) has launched a public consultation on new ethical standards for sustainability reporting.
  • These proposed standards aim to address the growing concern of greenwashing and enhance the quality of reported sustainability information.
  • The two exposure drafts released by the IESBA focus on International Ethics Standards for Sustainability Assurance (IESSA) and the framework for using the work of an external expert in sustainability reporting processes.

The International Ethics Standards Board for Accountants (IESBA) has launched a public consultation on new ethical standards for sustainability reporting. These proposed standards aim to address the growing concern of greenwashing and enhance the quality of reported sustainability information. With the increasing importance of sustainability information to multiple stakeholders, including investors, consumers, companies, and governments, there is a pressing need for a global baseline of ethics standards. Such standards ensure the integrity and objectivity of sustainability reporting, fostering trust and transparency among users of sustainability disclosures.

The IESBA has released two exposure drafts as part of its proposed ethical standards for sustainability reporting and assurance. The first exposure draft outlines a framework of expected behaviours and ethics provisions for sustainability assurance practitioners and professional accountants involved in sustainability reporting. The second exposure draft focuses on the framework to be applied by professional accountants or sustainability assurance practitioners when evaluating the competence, capabilities, and objectivity of external experts. This evaluation is crucial when utilizing the work of external experts in sustainability reporting processes.

The IESBA has initiated a public consultation process to gather feedback and insights from various stakeholders. This consultation period provides an opportunity for interested parties to contribute their perspectives and shape the final version of the ethical standards. The consultation period for the “Using the Work of an External Expert” proposal is open until April 30, while the sustainability standard proposal welcomes feedback until May 10. Interested individuals and organizations can access the exposure drafts and participate in the consultation process through the IESBA’s official website.

The release of these proposed ethical standards by the IESBA aligns with the global shift towards sustainability reporting and the emergence of various regulatory requirements and sustainability disclosure standards. The IESBA’s proposed standards complement these regulatory developments, ensuring that ethical considerations are an integral part of sustainability reporting and assurance processes. The IESBA worked in coordination with the International Auditing and Assurance Standards Board (IAASB) during the development of these proposed ethical standards to strengthen the global sustainability standards infrastructure.

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