CAQ Statement on CII’s Call for Companies to Disclose Sustainability Performance
Thursday, September 24, 2020
The Center for Audit Quality applauds the statement by the Council of Institutional Investors (CII) encouraging companies to disclose standardized metrics established by independent, private sector standard setters.
The building blocks of reliable, comparable and relevant ESG information begin with a foundation of quality reporting by company management. The challenge for public companies to determine what types of ESG information to report, and how to communicate relevant information to stakeholders in a landscape of multiple frameworks and standards, is real.
The CII statement also said that, over time, public companies should obtain external assurance of the sustainability performance information they provide.
“The U.S. public company auditing profession is a regulated profession steeped in bringing accountability, standards-based analysis and objectivity to the review of company-reported information,” said CAQ Executive Director Julie Bell Lindsay. “Like the audits of financial statements and internal control over financial reporting, third-party assurance from a public company audit firm enhances the reliability of ESG information presented by companies to investors and other stakeholders.”
According to a 2019 study by McKinsey & Co., nearly all participating investors (97%) want assured sustainability information. Nearly seven out of 10 investor respondents (67%) say assurance of sustainability information should be as rigorous as a financial audit.
About the Center for Audit Quality
The Center for Audit Quality (CAQ) is a nonprofit organization dedicated to promoting high-quality performance by public company auditors; convening and collaborating with financial reporting stakeholders; and advocating for policies and standards that promote public company auditors’ objectivity, effectiveness, and responsiveness to dynamic market conditions. For more information, visit thecaq.org.
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