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At ICGN reliable reporting is one of our core areas of focus, because we know that for our members, as investors, the provision and assurance of financial and sustainability related information is critically important to their investment processes. Alongside financial reporting, disclosure of a company’s sustainability related risks, opportunities and material performance metrics, is important to investors to enable them to compare companies across markets and sectors. It helps them to make informed decisions around investment, risk management and stewardship, and supports investors’ own reporting to their clients and beneficiaries.
In the UK, The Financial Reporting Council (FRC) has recently published the results of their market study on the assurance of sustainability reporting, launched in March. This study looked at the UK landscape for sustainability reporting assurance – who is doing the work, how are they doing it and what is the direction of travel….
At ICGN, we think that to produce reliable, comparable sustainable disclosures, the first key thing is that companies must be prepared to produce sustainability information, with strong governance, internal processes and controls for that. This is a crucial element to build trust for investors, but also to ensure that the information disclosed is verifiable, ready to be assured. Companies need to introduce rigorous processes to collect the data and document the information. There needs to be similar quality control as for traditional financial information. There must be Board oversight over this process and sign off of the results by the Board. Audit Committees should demonstrate competence for the oversight of sustainability and how this impacts the financial statements...
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