The largest global companies continue to show momentum on corporate reporting and related assurance involving environmental, social and governance (ESG) issues, according to a new report from the International Federation of Accountants (IFAC) and AICPA & CIMA, the latter two of which form the Association of International Certified Professional Accountants. Yet significant hurdles remain when it comes to providing consistent, comparable, and high-quality sustainability information for investors and lenders.

Some 95% of large companies reported on ESG matters in 2021, the latest year available, the IFAC-AICPA & CIMA study found. That’s up from 91% in 2019. Sixty-four percent of companies obtained assurance over at least some ESG information in 2021, up from 51% in 2019. The inability so far to coalesce around agreed upon global standards continues to create challenges, however.

“Even as we see companies increasingly report on ESG and sustainability, the data we’re tracking reveals continuing fragmentation around the world in terms of which standards and frameworks are used,” noted IFAC CEO Kevin Dancey. “Eighty-six percent of companies use multiple standards and frameworks. This patchwork system does not support consistent, comparable, and reliable reporting. Importantly, it also does not provide the necessary foundation for globally consistent, high-quality sustainability assurance.”

The report also examines the extent to which companies provide forward-looking information on emissions reduction targets and plans. While two-thirds of companies disclosed targets, they lag the rate at which companies report their historic greenhouse gas emissions (97%).

“Steady increases in reporting and assurance are significant, yet more companies need to take the additional step to obtain assurance to build trust and confidence in what they report,” said Susan Coffey, CPA, CGMA, AICPA & CIMA’s CE of public accounting. “The decision over who provides that assurance—and the rigor, skepticism and professional judgment they bring to the task—is critical.”

Additional Key Findings

• Use of Sustainability Accounting Standards Board (SASB) standards and the Task Force on Climate-Related Financial Disclosures (TCFD) framework have increased significantly between 2019 and 2021: there was a 29% increase for SASB standards usage and 30% for the TCFD framework.
• When companies obtained assurance from a professional accountant, they chose their statutory auditor 70% of the time.
• Globally, the International Auditing and Assurance Standards Board’s International Assurance Engagement Standard 3000 (Revised) remains the most popular standard when providing assurance.
  • 95% of firms providing assurance use ISAE 3000, up from 88% in 2019.
  • 38% of non-accountant service providers use ISAE 3000, up from 34% in 2019.

About the Study
IFAC and AICPA &CIMA partnered to understand the environmental, social, and governance (ESG) reporting and assurance practices on a global basis by capturing reports containing ESG information in 21 jurisdictions. 1,350 companies were reviewed—100 from each of the largest six economies, with 50 companies reviewed in the remaining 15 jurisdictions. The current report includes data from 2019-2021. Full methodology is available in the study.

About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.

About the Association of International Certified Professional Accountants, and AICPA & CIMA
The Association of International Certified Professional Accountants (the Association), representing AICPA & CIMA, advances the global accounting and finance profession through its work on behalf of 689,000 AICPA and CIMA members, students and engaged professionals in 196 countries and territories. Together, we are the worldwide leader on public and management accounting issues through advocacy, support for the CPA license and specialized credentials, professional education and thought leadership. We build trust by empowering our members and engaged professionals with the knowledge and opportunities to be leaders in broadening prosperity for a more inclusive, sustainable and resilient future.

The American Institute of CPAs (AICPA), the world’s largest member association representing the CPA profession, sets ethical standards for its members and U.S. auditing standards for private companies, not-for-profit organizations, and federal, state and local governments. It also develops and grades the Uniform CPA Examination and builds the pipeline of future talent for the public accounting profession.

The Chartered Institute of Management Accountants (CIMA) is the world’s leading and largest professional body of management accountants. CIMA works closely with employers and sponsors leading-edge research, constantly updating its professional qualification and professional experience requirements to ensure it remains the employer’s choice when recruiting financially trained business leaders.

Progressing sustainable development goals, including those related to climate change, requires urgent public sector action. Yet, as of now, no internationally recognized public sector reporting framework exists to help governments to measure and report on their critical contributions to addressing the global climate emergency and other sustainability challenges. With its public sector standard setting expertise and support of the international community, the International Public Sector Accounting Standards Board (IPSASB) is exploring how it might change that.  

IPSASB, IFAC and Accountancy Europe will host an interactive discussion around key ideas the IPSASB is exploring related to the development of sustainability standards and the resources necessary to deliver the urgently needed public sector reporting guidance. 

Equipping the Public Sector for Sustainability Action: Advancing transparency, comparability, and accountability with sustainability reporting will be held in Brussels, Belgium on April 4, 2023, from 4:00pm-6:00pm followed by a networking reception until 7:00pm.  

“The urgency of advancing public sector sustainability reporting cannot be overstated,” said Ian Carruthers, IPSASB Chair. “While the IPSASB is pleased to be playing a leading role in developing the thinking on this initiative, the involvement of the global community will also be crucial to equipping the public sector with the tools it needs to address climate change and other sustainability challenges.”  

“Public sector specific sustainability reporting standards will undoubtedly strengthen the global response to the climate crisis,” said Kevin Dancey, IFAC CEO. “IFAC applauds the IPSASB's lead on addressing this gap and encourages all of our stakeholders to get involved however they can.”  

“The public sector is essential to the economy in European countries: the necessary transition will not happen without it”, said Olivier Boutellis-Taft, Accountancy Europe’s CEO. “Proper sustainability reporting is a minimum and long-awaited first step. We applaud the IPSASB’s leadership and look forward to this discussion.” 

The event will feature:  

• Ian Carruthers, Chair, IPSASB  
• Olivier Boutellis-Taft, CEO, Accountancy Europe  
• Andrew Blazey, Deputy Head of Division and Lead, Green Budgeting, OECD 
• Maria-Rosa Aldea Busquets, Deputy Director General, DG Budget, European Commission 
• Laura Leka, Principal, IFAC
• Alex Metcalfe, Global Head of Public Sector, ACCA 
• Vivi Niemenmaa, Secretary General - INTOSAI WGEA / National Audit Office of Finland 
• Lebogang Senne, Technical Director, Pan African Federation of Accountants (PAFA)  
• Ross Smith, Program and Technical Director, IPSASB  
• Eelco van der Enden, CEO, GRI  
• Additional participants TBA 

The in-person interactive discussion will be followed by a networking reception. The event is free to attend and will be held in English. View the agenda and register now.  

About IPSASB 
The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, and the governments of Canada and New Zealand. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org. 

About IFAC 
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce. 

About Accountancy Europe 
Accountancy Europe unites 50 professional organisations from 35 countries that represent 1 million professional accountants, auditors, and advisors. They make numbers work for people. Accountancy Europe translates their daily experience to inform the public policy debate in Europe and beyond. Accountancy Europe is in the EU Transparency Register (No 4713568401-18). 

Progressing sustainable development goals, including those related to climate change, requires urgent public sector action. Yet, as of now, no internationally recognized public sector reporting framework exists to help governments to measure and report on their critical contributions to addressing the global climate emergency and other sustainability challenges. With its public sector standard setting expertise and support of the international community, the International Public Sector Accounting Standards Board (IPSASB) is exploring how it might change that.  

IPSASB, IFAC and Accountancy Europe will host an interactive discussion around key ideas the IPSASB is exploring related to the development of sustainability standards and the resources necessary to deliver the urgently needed public sector reporting guidance. 

Equipping the Public Sector for Sustainability Action: Advancing transparency, comparability, and accountability with sustainability reporting will be held in Brussels, Belgium on April 4, 2023, from 4:00pm-6:00pm followed by a networking reception until 7:00pm.  

“The urgency of advancing public sector sustainability reporting cannot be overstated,” said Ian Carruthers, IPSASB Chair. “While the IPSASB is pleased to be playing a leading role in developing the thinking on this initiative, the involvement of the global community will also be crucial to equipping the public sector with the tools it needs to address climate change and other sustainability challenges.”  

“Public sector specific sustainability reporting standards will undoubtedly strengthen the global response to the climate crisis,” said Kevin Dancey, IFAC CEO. “IFAC applauds the IPSASB's lead on addressing this gap and encourages all of our stakeholders to get involved however they can.”  

“The public sector is essential to the economy in European countries: the necessary transition will not happen without it”, said Olivier Boutellis-Taft, Accountancy Europe’s CEO. “Proper sustainability reporting is a minimum and long-awaited first step. We applaud the IPSASB’s leadership and look forward to this discussion.” 

The event will feature:  

• Ian Carruthers, Chair, IPSASB  
• Olivier Boutellis-Taft, CEO, Accountancy Europe  
• Andrew Blazey, Deputy Head of Division and Lead, Green Budgeting, OECD 
• Maria-Rosa Aldea Busquets, Deputy Director General, DG Budget, European Commission 
• Laura Leka, Principal, IFAC
• Alex Metcalfe, Global Head of Public Sector, ACCA 
• Vivi Niemenmaa, Secretary General - INTOSAI WGEA / National Audit Office of Finland 
• Lebogang Senne, Technical Director, Pan African Federation of Accountants (PAFA)  
• Ross Smith, Program and Technical Director, IPSASB  
• Eelco van der Enden, CEO, GRI  
• Additional participants TBA 

The in-person interactive discussion will be followed by a networking reception. The event is free to attend and will be held in English. View the agenda and register now.  

About IPSASB 
The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, and the governments of Canada and New Zealand. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org. 

About IFAC 
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce. 

About Accountancy Europe 
Accountancy Europe unites 50 professional organisations from 35 countries that represent 1 million professional accountants, auditors, and advisors. They make numbers work for people. Accountancy Europe translates their daily experience to inform the public policy debate in Europe and beyond. Accountancy Europe is in the EU Transparency Register (No 4713568401-18). 

The International Ethics Standards Board for Accountants and the International Auditing and Assurance Standards Board applaud the recent announcement by the International Sustainability Standards Board (ISSB) that final decisions for all technical content related to ISSB's inaugural sustainability standards have been made and that the ISSB is entering the final stages of the standards development process ahead of an expected issuance at the end of Q2 2023.

We echo the recent statement of support from the International Organization of Securities Commissions (IOSCO) and appreciate IOSCO's encouragement for our boards’ work to develop standards by the end of 2024. The IOSCO statement is a timely reminder that providing the necessary assurance and ethics standards is essential to complete the sustainability reporting and assurance standards infrastructure. We will continue to work closely with all parties as we develop our sustainability standards, which we will discuss at our respective March meetings.

The Technology Consultation Group of the International Auditing and Assurance Standards Board (IAASB) today released non-authoritative support material to help address certain frequently asked questions about investigating exceptions and the concept of performance materiality when performing audit procedures using automated tools & techniques (ATT). While not unique to ATT, questions on these topics have become more prevalent with the increasing use of ATT, which enable analyzing data sets with large volumes of information.

The publication does not amend or override the International Standards on Auditing (ISAs), the texts of which alone are authoritative. Reading the publication is not a substitute for reading the ISAs. 

Other technology-related publications are available on the IAASB’s Technology web page.

The International Ethics Standards Board for Accountants (IESBA) recently held three global webinars on the upcoming Tax Planning and Related Services exposure draft (ED). The ED was released on February 17, and comments are requested by May 18.

During the webinars, members of the Tax Planning and Related Services Task Force explained the key proposals in the ED, among other matters, including:

• Compliance with the fundamental principles, highlighting the types of threats that might be created when providing tax planning activities.
• Understanding the applicable tax laws and regulations, the legislative intent behind the relevant laws and regulations, and the economic purpose and substance of the transaction.
• Exercising professional judgment to establish a credible basis for the tax planning arrangement in circumstances of uncertainty. This includes a consideration of the reputational, commercial, and wider economic consequences arising from the way stakeholders might view the arrangement.
• Communicating relevant matters or concerns with the individual client, management, or those charged with governance, including as part of an escalation process where necessary.
• Developing an appropriate level of documentation throughout the process to substantiate the judgments, decisions, and actions.

Watch the recordings now and learn more about these important proposals. 

Monday, February 27 | 10 am – 11 am EST | Click here, led by Jens Poll

Tuesday, February 28 | 4 pm – 5 pm EST | Click here, led by Andrew Mintzer

Tuesday, February 28 | 9 pm – 10 pm EST | Click here, led by Channa Wijesinghe

At the start of 2023, IFAC’s Professional Accountants in Business (PAIB) Advisory Group welcomed four new volunteer members nominated by the professional accountancy organizations that make up IFAC’s membership.  

Professional accountants in business comprise a significant part of the profession working in commerce, industry, financial services, education, and the public and not-for-profit sectors. Formed in 1977, the PAIB Advisory Group’s focus is to ensure these accountants meet the future needs of business and the public sector. 

The newest PAIB Advisory Group members are: 

• Esther Bosch, Head of Internal Audit & Risk, Stahl Holdings (Netherlands) 
• Lindawati Gani, Professor in Management Accounting, Faculty of Economics and Business, Universitas Indonesia (Indonesia) 
• Maria del Dado Alonso Sanchez, Group CFO, Berlin Brands Group (Spain) 
• Muhammad Samiullah Siddiqui, CFO, Oxford University Press Pakistan (Pakistan) 

"Each member brings a unique, valuable perspective of the different roles professional accountants perform in business and finance leadership to the profession and its key stakeholders,” said Sanjay Rughani, Chair, IFAC PAIB Advisory Group. “We are honored to have these new members join us to share their diverse experiences and provide strategic input on opportunities for professional accountants to create value in their roles across the globe.”  

The continuing PAIB Advisory Group members are:  

• Sanjay Rughani, Chair, CEO, Standard Chartered Bank Uganda (Uganda)
• Nancy Sau Ling Tse, JP, Deputy Chair, Independent Non-Executive Director [Hong Kong (Special Administrative Region of China)]
• Zia-Ul-Mustafa Awan, CFO and Business Administrator, Pakistan Expo Centres Private Limited (Pakistan)
• Gregory Bedard, Chief of Staff, Prudential Financial (United States)
• Anastasija Boljević, Secretary General, Institute of Certified Accountants of Montenegro (Republic of Montenegro)
• Ibrahim (Murat) Çağlar, Chief Financial Officer, Sanovel (Turkey)
• Sharon Ditchburn, Managing Director/Founder, Capital Advantage Consultants (Australia)
• Eric Freudenreich, Independent Non-Executive Director (France)
• Tim Herrod, FCPA, FCA, Vice President, Global Procurement, Albemarle Corporation (Canada)
• Nihar Jambusaria, Past President, The Institute of Chartered Accountants of India (India)
• Catherine Little, Non-Executive Director, Head of the Government Finance Function, and Second Permanent Secretary, HM Treasury (United Kingdom)
• Margaret Muinde, Financial Controller, Kenya Roads Board (Kenya)
• Stephen L. Muscat, Chief Financial Officer & Company Secretary, Liquigas Malta Limited (Malta)
• Esteban Quiros, Director of Global Business Services, Procter and Gamble (Costa Rica)
• Milton Segal, Executive Director: Standards, South African Institute of Chartered Accountants (South Africa)
• Ichiro Waki, Group CEO, JBA Group (Japan)
• Gloria Zvaravanhu, Managing Director, Old Mutual Insurance Company (Zimbabwe)

Member expertise is drawn upon to deliver timely reports, articles, and case studies relevant to professional accountants in business across the globe. Explore their latest insights. 

About IFAC 
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in 135 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce. 

About the Professional Accountants in Business (PAIB) Advisory Group 
Professional accountants in business comprise a significant part of the profession working in commerce, industry, financial services, education, and the public and not-for-profit sectors. The Professional Accountants in Business (PAIB) Advisory Group focuses on ensuring these accountants meet the future needs of business and the public sector. 

Earlier today, the IESBA released "Continuing with the Development of Global Ethics and Independence Standards for Sustainability Reporting and Assurance," a publication providing an overview of the sustainability-related decisions made by the Board at it's recent meeting and how those decisions will shape the Board's work in 2023 and beyond.

On December 2, 2022, the Board unanimously approved two new projects that will deliver the following:

Sustainability Project

• Profession-agnostic independence standards for use by all sustainability assurance practitioners
• Specific ethics provisions relevant to sustainability reporting and assurance 

Experts Project

• Specific ethics and independence provisions addressing the use of experts by organizations as well as in the context of audit and assurance engagements (including sustainability assurance) 

Read more here.

The Invitations for Applications for vacancies on the International Ethics Standards Board for Accountants (IESBA) and the International Auditing and Assurance Standards Board (IAASB) have been issued by the Public Interest Oversight Board’s (PIOB) Standard-Setting Boards Nominations Committee for terms beginning January 1, 2024. The application period is open until February 10, 2023.

The Invitations for Applications are open to all individuals and interested organizations, including those representing investors and the corporate governance community, regulatory bodies, national standard setters, audit practitioners, professional accountancy organizations and public sector organizations, and those in academia. Individuals may also make nominations on their own behalf.

These vacancies are exciting opportunities for experienced individuals from diverse backgrounds to contribute to the evolving multi-stakeholder and multi-cultural composition of each board. Importantly, there is a tremendous opportunity to take part in the IESBA´s project to gain further global recognition and acceptance of its ethics and independence standards as a cornerstone of trustworthy reporting and assurance of financial and sustainability information, thereby contributing to safeguarding the proper functioning of financial markets and economies worldwide.

As the International Code of Ethics for Professional Accountants (including International Independence Standards) is adopted or used in more than 130 jurisdictions worldwide, geographical balance is key to equipping the IESBA with the necessary regional experience and insights to develop relevant and globally operable ethics and independence standards. In this context, considering the current composition of the IESBA, applications are particularly, but not exclusively, sought from Asia, Latin America and the Caribbean, and Oceania.

For additional information on IAASB or IESBA nominations, please see the PIOB’s nominations web page or email SSBNomination@ipiob.org.

About the IESBA

The IESBA is an independent global standard-setting board. The IESBA's mission is to serve the public interest by setting ethics standards, including auditor independence requirements, which seek to raise the bar for ethical conduct and practice for all professional accountants through a robust, globally operable International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code).

The IESBA believes a single set of high-quality ethics standards enhances the quality and consistency of services provided by professional accountants, thus contributing to public trust and confidence in the accountancy profession. The IESBA sets its standards in the public interest with advice from the IESBA Consultative Advisory Group (CAG) and under the oversight of the Public Interest Oversight Board (PIOB).