New UK standard for sustainability assurance launched

The voluntary ISSA (UK) 500 (115-page / 1.77MB PDF) has been designed as a UK version of the global standard for sustainability assurance which was developed by governing body the International Auditing and Assurance Standards Board.

The aim of the new standard, which aligns with the international equivalent, is to ensure a consistent set of requirements for those providing sustainability assurance that can be applied to both limited and reasonable assurance and operate agnostically across professions.

James Hay, a sustainable finance expert with Pinsent Masons, said the new standard would bring the UK into alignment with international approaches to the issue.

“Previously auditors have employed slightly different methodologies when carrying out limited assurance over sustainability disclosures,” he explained.

“This can complicate matters for companies seeking to implement an audit-ready reporting process.

“This new standard should help tackle that uncertainty for UK companies, and provide consistency and guidance for UK assurance providers.”

The new standard has been drawn up after consultations with stakeholders, professional bodies and investors, who backed it as a voluntary measure.

Gary Gray, a governance expert with Pinsent Masons, said it would have a long-term benefit for the sector.

“Although these changes may increase compliance pressure in the short term, they are likely to be received positively as they enhance transparency, consistency, and credibility in sustainability reporting,” he said.

The FRC said the standard, which would ensure the credibility of environmental, social, and governance reporting, would help maintain the UK’s role as a destination for sustainable finance.

“The release of ISSA (UK) 5000 marks a significant step in establishing a consistent framework for sustainability assurance in the UK,” said Mark Babington, executive director of regulatory standards at the FRC.

“By underpinning investor confidence in sustainability disclosures, this standard will help UK companies access capital more efficiently and contribute to long-term economic growth.”