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Report from the International Federation of Accountants on August 11, 2023
To meet the demand for globally unified sustainable development assurance standards, the International Audit and Assurance Standards Board (IAASB) has developed the proposed International Sustainable Assurance Practice Standard No. 5000- General Requirements for Sustainable Development Assurance Practice (ISSA 5000). The ISSA 5000 was developed by IAASB in close coordination with major global and regional standard setting agencies responsible for sustainable development reporting. This groundbreaking guideline aims to establish global benchmarks for sustainable development assurance by improving the quality and credibility of sustainable development information, thereby enhancing accountability and transparency. The proposed guidelines have now been publicly solicited for public opinion, and the consultation period will end on December 1, 2023.
The notable features of ISSA 5000 include:
1) Framework neutrality allows for the use of ISSA 5000 regardless of the reporting framework, standards, or guidelines adopted by the reporting entity, providing flexibility and convenience for the implementation of the guidelines in different contexts.
2) Scalable, which means that this criterion can be used to authenticate individual indicators of small entities, overall sustainability information reported by groups, and even sustainability information across the entire entity value chain.
3) Regardless of the qualifications and background of the practitioners, assurance practitioners in any industry can use this standard, provided that they comply with relevant ethical requirements and adopt a quality management system that is at least as strict as the International Code of Ethics for Accountants (including the International Standards of Independence) issued by the International Accounting Ethics Standards Board and the entire set of quality management standards of IAASB. This inclusivity enables professionals from different backgrounds to participate in sustainable development assurance business.
4) Applicable to assurance services that provide limited and reasonable assurance, and clearly distinguish the differences in the procedures implemented.
5) Easy to understand, concise and clear, taking into account the needs of various stakeholders in the sustainable development authentication ecosystem. IAASB has developed this standard through a collaborative approach, utilizing the professional knowledge and insights of IAASB members, IAASB related organizations (including accountants and other professionals), and other major stakeholders.
The proposed ISSA 5000 establishes a global benchmark for personnel and institutions providing sustainable development assurance services. It introduces key elements that can strengthen the authentication process and promote reliable sustainable development reporting, including:
1) Emphasize competence and maintain professional skepticism;
2) Emphasize the importance of risk procedures, identify and focus on important sustainable development issues;
3) Provide guidance for planning, implementing, and documenting assurance procedures;
4) Emphasize the importance of clear and transparent reporting and communication.
Once ISSA 5000 is finalized and used by assurance practitioners, it will bring many benefits to organizations, assurance practitioners, and stakeholders, including:
1) Enhance public credibility and trust;
2) Helps to make thoughtful and wise decisions;
3) Strengthen global consistency;
4) Cracking down on "greenwashing" behavior;
5) Promote continuous improvement.
The proposed International Standards for Sustainable Assurance Practice No. 5000 is a milestone in sustainable development reporting and assurance, and will play a key role in improving the quality and credibility of sustainable development reports. By providing a strong framework for assurance practitioners, ISSA 5000 enables organizations to demonstrate their commitment to enhancing transparency and accountability, while providing reliable information for stakeholder decision-making. With sustainable development becoming a central issue in the world today, ISSA 5000 has established a global benchmark for sustainable development assurance, driving positive change and promoting a more sustainable future.