Sustainability reporting and assurance practices of the world’s largest companies continue to mature

The world’s largest companies are providing more detailed and extensive sustainability reports, and are receiving broader assurances about their disclosures, according to a new report from the International Federation of Accountants (IFAC), AICPA and CIMA. It is said that there is.

The study is an annual benchmark that currently includes data for 2022, and the use of a variety of sustainability standards and frameworks allows investors, lenders, and other stakeholders to achieve consistent and comparable sustainability results. We also found that information continues to be difficult to find.

Although progress has been reported, The State of Play: Sustainability Disclosures and Assurances, Trends and Analysis 2019-2022highlights the need for companies around the world to move towards a global system of sustainability disclosure requirements. On a positive note, the survey found that more than half of companies use Sustainability Accounting Standards Board (SASB) standards and the Task Force on Climate-related Financial Disclosures (TCFD) framework, which This should ease the transition to the International Sustainability Standards Board (ISSB). ) standards released last year.

David Maddon, Director of Sustainability, Policy and Regulation at IFAC, said: “We are progressing towards universally accepted global standards, but around 87% of companies report using a combination of standards and frameworks. I continue to use it.” “This leaves investors and lenders in a bind when it comes to accessing consistent, comparable, and high-quality sustainability information.”

Highlights of the latest research include:

• Almost all companies (98%) report some information on sustainability. This is up from 91% in 2019, when IFAC, AICPA, and CIMA first began research in this area.
• The use of independent sustainability reports has decreased by 27 percentage points over the past three years. Only 30% of companies used a standalone sustainability report in 2022. This reflects the increasing inclusion of that information in companies’ annual and integrated reports.
• 69% of companies obtained assurance on at least some of their sustainability disclosures, an increase of 5 percentage points from last year and 18 percentage points from 2019. The scope of the warranty field has also expanded, but remains generally limited.
• In 2022, accounting firms (as opposed to consultants or other service providers) handled 58% of sustainability-related assurance engagements., an improvement of many percentage points over the previous year. In some markets, particularly the US, it’s well below 50%.

“When companies use an accounting firm for sustainability assurance, they are more likely to choose the same firm they use to audit their financial statements,” says CPA, CGMA, AICPA, CIMA said Susan Coffey, Chief Executive Officer of Public Accounts. . “The level of trust in sustainability disclosures should be the same as in financial information, so we expect more companies to recognize that accounting firms are best suited for this important task.” We believe this is likely a factor in the increase from 16% to 23% of US accounting firms doing so. ”