Sustainability assurance is a certification that ensures the sustainable production of products and services, in terms of improving living conditions, social responsibilities and environmental performance. It is a third party verification of sustainability efforts, including reports on sustainability or ESG audits.
There are many companies out there which provide Sustainability Assurance services to help other businesses gain this distinction. A common way to obtain one’s certification is through an On-Site Assessment, in which independent auditors visit your office and review your documentation to verify your company’s claims. Certifications such as the International Organization for Standardization (ISO) or SGS can be achieved through this method.
What is ESG in regard to sustainability assurance?
ESG stands for Environment, Social & Governance factors. It is an evaluation of environmental factors, social responsibility and governance criteria in companies’ policies and practices to provide a thorough picture of company behavior.
What are the advantages to corporate sustainability reporting?
Most businesses choose to get their certification in order to give their business an advantage over their competitors and receive the benefits of Sustainability Assurance itself: increased customer confidence, employee motivation and generally higher profits. These are only a few of the many reasons that businesses go through with this process.
Sustainability Assurance is an important component in what it means to be eco-friendly, and complying with these standards is crucial for any company seeking to live up to their ESG claims. But here are few more:
- Sustainability Assurance’s benefits are not only limited to the business itself; it also strengthens employees’ resolve. Their pride in their company and their dedication to its success, paired with the knowledge that their work has a positive impact on society and the world around them, will encourage employees to be at their best.
- Additionally, by investing in Sustainability Assurance, businesses can market themselves as values-aligned companies who care about everything from product quality to worker wages. Such a strategy will attract customers who seek to do business with like-minded companies.
- Sustainability Assurance bridges the gap between corporate social responsibility and environmental compliance by verifying companies’ claims of environmental friendliness and ethical conduct, creating value for all stakeholders.
- The benefits of Sustainability Assurance on a company’s reputation are invaluable; customers can trust that the products or services they buy are sustainable and beneficial for them, employees will be proud to work for a company with integrity, and other interested stakeholders can rest assured that business partners, suppliers and funders are also investing in the improvement of society.
- Sustainability Assurance helps companies build their brand by demonstrating transparency and accountability. By putting their money where their mouth is, businesses can take advantage of the increased customer loyalty and public interest.
- Sustainability Assurance provides an environment-friendly label which has benefits for both consumers and companies.
All these factors contribute to Sustainability Assurance’s appeal, as its usefulness spans every facet of business strategy.
What products and services can it be used on?
Sustainability Assurance is used for products like food, clothing, building materials and furniture. It can be applied to both consumer goods (products that are made for final consumers) and industrial goods (products that are not made for final consumers). Having an independent third party verify your company’s practices of sustainable production assures consumers that they are purchasing products and services that consider environmental responsibility, social accountability and economic viability.
What is sustainability in auditing?
Sustainability in auditing refers to the ethical and environmental responsibilities that an auditing company is held to. Sustainability assurance is part of the overall concept of corporate social responsibility, which focuses on more than just financial gain. Businesses are expected to contribute not only to their bottom lines but also to the well-being of society as a whole. The goal is for businesses to be profitable and sustainable, not only today but also for future generations.
What are two examples of assurance providers?
There are many assurance providers including BSI, DNV GL, GmbH, Fairtrade International and more.
What is the concept of sustainability reporting?
Sustainability reporting is a process of communicating the sustainability performance of an organization in terms of economic, environmental and social factors. It often involves providing transparency to stakeholders about how well the business is doing in regards to these topics.
What are 3 standards that can be achieved through certification?
Three standards that can be achieved through certification are ensuring environmental performance, compliance with social responsibilities, and improvement of living/working conditions.
What does the independent third party verification include?
The independent third party verification includes verifying company claims about their efforts in terms of sustainable production. This may include evaluating self-reported data including progress on sustainability targets. It also includes assessing whether the criteria of the certification align with the ISO 14040 and ISO 14044 standards, as well as whether it is integrated into everyday business.
What are examples of sustainability initiatives?
Sustainability initiatives may include efforts to make sure that their products and services do not harm the environment or social conditions. This can be done through reducing energy consumption and greenhouse gas emissions, and by improving material and water efficiency. Other efforts include engaging the community where they’re working, and reducing waste.
What is the purpose of a certification scheme?
The purpose of a certification scheme is to assess an organization’s sustainability performance against third-party standards such as ISO 14065 and ISO 14024. It then offers the company a certification of this assessment to demonstrate its efforts in terms of sustainable production.
What are examples of Sustainability Assurance products?
Some examples of Sustainability Assurance products include cocoa, coffee, tea and bananas. These products are generally considered to be our everyday goods, including food, clothing, building materials and furniture. It can be applied to both consumer goods (products that are made for final consumers) and industrial goods (products that are not made for final consumers).
What is corporate citizenship?
Corporate citizenship refers to an organization’s proactive role in society, beyond just delivering business results. It includes the company’s contribution to society through their operations and how that contribution affects communities.
What are 3 types of auditors?
Three types of auditors are identified in the industry, including Type I, Type II and Type III auditors.
A ‘Type I Auditor’ is someone who has passed either the CSBL Exam or PACE Sustainability Leadership exam. These auditors are qualified to conduct audits of organizations that have completed a self-assessment or management review.
A ‘Type II Auditor’ is someone who has passed either the CSAP exam or ISO 14024 certification exam. These auditors are qualified to conduct audits of organizations that have not completed a self-assessment or management review.
A ‘Type III Auditor’ is someone who has in depth experience and knowledge related to sustainability in multiple areas including: legal, supply chain, operations and technologies. These auditors are qualified to perform SOC 2 Type II examinations.
How do you become a sustainability auditor?
To become a sustainability auditor, a person must first identify as a ‘global Sustainability Assurance professional’. To do this, one must pass the global MCA AICPA/IIA Sustainability Assurance Qualification Examination. This is an international test that focuses on all of the body of knowledge within the field of sustainable development. Professionals who pass this exam are then able to use the globally recognized designation of ‘Associate in the Field of Sustainability’, or AFS for short.
Associates can also seek certification as a Certified Sustainable Business Leader by passing the CSBL Exam. Professionals who pass this exam are then able to use the globally recognized designation of ‘Certified Sustainable Business Leader’, or CSBL for short.
Certification as a Sustainable Business Leader can also be obtained by passing the PACE Sustainability Leadership examination. Professionals who pass this exam are then able to use the globally recognized designation of ‘Professional in Accountability and Corporate Engagement’ (PACE).
Attainment of certification as a Certified Sustainable Business Leader (CSBL) also enables professionals to use the designation of Certified Sustainability Assurance Professional (CSAP). These three designations are known as the ‘Professional Certifications’.
The third path for becoming a sustainability auditor is by gaining experience in Sustainable Development, then passing the ISO 14024 certification exam. Professionals who pass this exam are then able to use the globally recognized designation of ‘ISO 14024 Assessor’.
To become an auditor that conducts SOC 1 Type II examinations, one must be a PACE or ISO 14024 Assessor. To perform audits focused on ESG issues, one must pass the MCA Sustainability Assessment Examination, which is open only to PACE or ISO 14024 Assessors.
To become an auditor that conducts SOC 2 Type II examinations, one must be a PACE Assessor. To perform audits focused on ESG issues, one must pass the MCA Sustainability Assessment Examination, which is open only to PACE Assessors.
What is required of an auditor?
An auditor must possess extensive knowledge related to the field of sustainable development including: legal, social, human rights, economic and environmental topics. Additionally, they must possess substantial education in Sustainable Development principles. Most importantly, an auditor must have experience conducting SOC 1 or 2 Type II audits.
What does a sustainability professional need to do in order to become a Certified Sustainability Assurance Professional?
In order for a sustainability professional to become a Certified Sustainability Assurance Professional (CSAP), they must pass the MCA AICPA/I
Do sustainability reports have to be audited?
No. Sustainability reports are third party verified by a certification process, but it does not have to be audited.
In conclusion on sustainability audit methodology
In this article we learned about what is meant by “Sustainability Assurance” and how it assures the production of sustainable products. We also learned about certification as a ‘sustainability auditor’ and some of the requirements of someone who would want to be certified. It is important because it ensures sustainability in the workplace.
Caveats, disclaimers & the global reporting initiative
We have covered many topics in this article and want to be clear that any reference to, or mention of sustainability reporting, global reporting initiative, sustainability audit methodology, corporate sustainability reporting, international certified professional accountants, sustainability audit, sustainability reports, global organization, assurance providers, assurance standards, obtaining assurance, corporate governance, supply chain, business activities, public interest, attestation engagements, decision making, stakeholder trust, social and environmental reporting. Please also see our article outlining a related topic of CFA ESG investing certificate. And any reference to bureau veritas, assurance or business decisions, GRI standards or global reporting from other stakeholders, reporting by companies, clients or accounting staff of an audit, resources, social impact, focus, stakeholders, commitment, governance, data, methodology, consulting, develop, quality, auditing, guidance, report, more information, initiatives, audits, processes, tools, organizations, evaluating, investors, material, waste, emphasis, tax, contact, regulators, procurement, examine, practices, scope, guarantee, world, accountability, critical, organization or insights in the context of this article is purely for informational purposes and not to be misconstrued with investment advice or personal opinion. Thank you for reading, we hope that you found this article useful in your quest to understand ESG.