01 Dec 2023

ECG response to IAASB consultation on the exposure draft of proposed ISSA 5000, General Requirements for Sustainability Assurance Engagement (ED-5000)

The ECG welcomes the significant work the IAASB has accomplished in developing ED-5000 and supports the creation of a global baseline of standards for sustainability assurance engagements. 

The ECG highlights the following points:

(1) ED-5000 provides an appropriate and supporting baseline for sustainability assurance engagements over sustainability reporting as required in the EU, although it does not address all sustainability information to be reported under the EU rules or other EU requirements.

(2) One crucial area that needs to be further developed relates to the procedures the assurance provider is expected to perform on the materiality assessment process carried out by the reporting entity to determine what sustainability information to include in its reporting. This should be further addressed and included in the requirements section of ISSA 5000, given its fundamental importance.

(3) Compliance with relevant ethical/independence requirements and maintenance of an effective system of quality management are critical for the performance of consistent, high-quality sustainability assurance engagements. In this regard, more guidance and transparency are needed on other professional requirements, or requirements imposed by law or regulation, which are to be considered “as least as demanding” as the IESBA Code and ISQM 1, which are already commonly applied by auditors, both for financial statement audits and other assurance engagements.

Read the full ECG response.