LAKE MARY, FL, March 30, 2023 – The Committee of Sponsoring Organizations of the Treadway Commission (COSO) today released a study with supplemental guidance for organizations entitled “Achieving Effective Internal Control of Sustainability Reporting (ICSR).” The guidance uses the globally recognized COSO Internal Control-Integrated Framework (ICIF) as its basis.
The new guidance, which expands on a previous COSO study from 2017, is particularly timely given the forthcoming final regulations on climate risk from the U.S. SEC and global standards from the International Sustainability Standards Board (ISSB).
Notable aspects of the ICSR guidance include:
- References to the role of the internal audit function in sustainability reporting in the scope of the guidance, reflecting their integral part of ICSR.
- Key themes to consider as organizations continue their journeys toward establishing and maintaining an effective system of internal control over financial and sustainable business information.
- Insights from companies that are leading the way on ICSR to help more firmly establish the practice within the internal audit profession.
“While organizations have largely followed their own journey into sustainability reporting to this point, forthcoming standards and regulation have provided the impetus for quicker action,” said Brad J. Monterio, The IIA’s Executive Vice President of Member Competency and Learning and sustainability subject matter expert, who served as a co-author of this supplemental guidance. “This newly released guidance is an opportunity for Chief Audit Executives to engage with their audit committees, the C-suite and the risk management team to help their organization build confidence in their sustainability reports among their internal and external stakeholders.”
The principal authors of this guidance are:
- Robert Herz, former FASB chair, founding member of the IASB and former SASB Foundation board member;
- Robert Hirth, Senior Managing Director at Protiviti, former COSO Chair and former vice-chair of the SASB;
- Douglas Hileman, consultant, ESG specialist, and member of [former] ESG Leadership Knowledge Group;
- Shari H. Littan, IMA Director, Corporate Reporting Research and Thought Leadership;
- Brad Monterio, IIA EVP of Member Competency and Learning, IIA’s representative to the ESG Exchange, and member of the IFRS Foundation’s IRCC; and
- Jeffrey C. Thomson, President and CEO of IMA and former COSO board member/lead director.
For more information, and to download a free copy of Achieving Effective Internal Control over Sustainability Reporting (ICSR): Building Trust and Confidence through the COSO Internal Control―Integrated Framework, please visit the COSO website.
About The Institute of Internal Auditors
The Institute of Internal Auditors (IIA) is an international professional association that serves more than 230,000 global members and has awarded more than 185,000 Certified Internal Auditor (CIA) certifications worldwide. Established in 1941, The IIA is recognized throughout the world as the internal audit profession's leader in standards, certifications, education, research, and technical guidance. For more information, visit theiia.org.