In January, the International Auditing and Assurance Standards Board (IAASB), the independent standard-setting body, issued its pioneering International Standard on Sustainability Assurance (ISSA) 5000 in record time, taking just two years to compile the rules. ISSA 5000 is a global framework that establishes baseline requirements for sustainability assurance engagements.

IAASB Chair Tom Seidenstein told ICAEW’s recent sustainability assurance event that it was important to “act speedily to avoid fragmentation” but he said that “speed did not mean sacrificing quality”.

In jurisdictions that adopt it, ISSA 5000 will come into effect for financial periods beginning on or after 15 December 2026. More and more jurisdictions are requiring sustainability disclosures and are turning their attention to the need for reliable assurance, so it is considered critical that ISSA 5000 supports assurance of sustainability information.

“One of the challenges, of course, is the lack of uniformity across the globe, both in accounting and assurance, and it is therefore very important that the standards we’re talking about today are implemented and put in place across the world. Because the world can’t work without trust in the information it relies on. And trust, I think, is a commodity that is in short supply,” said ICAEW President Malcom Bacchus, also past chair of ICAEW’s ethics standards committee, who was hosting the event at Chartered Accountants’ Hall.

The standard’s goal is to enable assurance practitioners to offer consistent and comparable services across markets, boosting investor confidence and enhancing the credibility of sustainability reporting globally.

“There is a huge challenge in building up an equivalent, trustworthy infrastructure around non-financial capital in a very short period of time. And yet, if we don’t, greenwashing will abound and, worse, we will make faulty decisions based on dubious data, which will impact not only on us but the economies of the world and the planet itself,” Bacchus said.

On the sustainability journey

Seidenstein said that the ICAEW event was vital to share practical advice, build knowledge, exchange ideas and experience, and to guide domestic standard-setters, regulators and practitioners as “we embark on the sustainability journey together”.

“Journeys are never simple,” Seidenstein said. “On a journey, you often meet the unexpected. You meet delays from time to time. You often make compromises along the way, but the most important thing ultimately is to keep advancing towards the final destination.”

The IAASB Chair was referring to how some jurisdictions, namely the US since President Donald Trump came to power, “announced a reconsideration or recalibration of the sustainability requirements and commitments”.

Although he acknowledged the need to pay attention to this shift in landscape, Seidenstein said he remained convinced that in the longer term, the trend is likely to continue towards greater sustainability standards.

“Investors globally, those who provide the actual capital, will continue to seek broader measures of corporate performance. Even before mandatory requirements, more than 95% of the world’ s largest companies were providing some form of sustainability reporting and, despite whatever shifts were happening or happened in some jurisdictions, many countries and companies are continuing to adopt sustainability reporting requirements,” he said.

Practical guidance

Following the adoption of the new rules last year, the IAASB is now in a new phase of supporting consistent adoption and implementation through guidance, establishing monitoring activities to tackle practical implementation challenges and allowing a period of stability so that stakeholders can absorb the changes and prepare for them.

“We are committed to outreach activities and will monitor implementation as well as work with national standard-setters. Our focus will be on issuing guidance that is concise, focused and pragmatic,” said Seidenstein.

The new rules can be used by anyone irrespective of size or sector. ISSA 5000 is principles-based and built off existing practices already embedded in the well established and widely used assurance standards. ISSA 5000, however, provides more specificity to reflect convergence around new sustainability reporting requirements and assure greater consistency in practice.

Josephine Jackson, IAASB Vice-Chair, acknowledged that there were some areas of sustainability reporting and assurance that would be challenging for both preparers and practitioners. “So we agreed that we would develop implementation guidance to support practitioners from both an educational perspective and with more space for illustrative examples, and we wanted to launch that alongside the standard, which was a change for us as a board.”

Mark Babington, board member of the International Ethics Standards Board for Accountants (IESBA) and Executive Director of Regulatory Standards at the Financial Reporting Council, was also present at the event to highlight the development of the new code of ethics to support sustainability reporting and assurance.

“One of the benefits about the development of both the assurance standards and the ethics and independence standards is that because we have worked along the process together, we’ve made sure that what we’ve got for you is a really well coordinated and aligned package of requirements, and that should help in terms of working together in a really clear way,” Babington said.

Seidenstein added that organisations such as ICAEW play a critical role in developing curriculum and training programmes like ICAEW’s new Sustainability Accelerator Programme, to develop expertise and capacity to manage the emerging requirements of sustainability assurance and reporting.

“A new generation of talent in the accountancy profession will have to expand their skill set in the audit and assurance toolkit,” he said. “Clearly this will be a challenge, but we must see this as an opportunity as well for the profession to demonstrate their continued relevance and remain attractive to future generations of professionals.”