The Exposure Draft includes proposed guidance on the application of the conceptual framework in the Code to address the topic of the objectivity of an engagement quality reviewer (EQR), thereby supporting proposed ISQM 2 in addressing the matter of the eligibility of an individual to serve in an EQR role. In particular, the proposed guidance:

• Explains the different types of threat to compliance with the fundamental principle of objectivity that might be created in circumstances where an individual is being considered for appointment as an EQR for a given engagement;
• Sets out factors to consider in evaluating the level of the identified threats; and
• Suggests actions that might be safeguards to address the threats.

The development of the proposal benefited from cooperation with the IAASB within the established coordination framework of the two Boards. The IESBA is proceeding on an accelerated time frame to finalize the proposal in order to align closely with the anticipated finalization of ISQM 2 within 2020.

Review the press release and Exposure Draft on the IESBA's website.

The Role and Mindset Revisions, released in early October, explicitly recognize that the accountancy profession is entrusted with public confidence in the wide-ranging roles it plays in society and that such confidence is based on the skills and values it brings to its professional activities. Importantly, they reaffirm the profession’s responsibility to act in the public interest and the fundamental role of the Code in meeting that responsibility.

Review the press release and fact sheet on the IESBA's website.

The main revisions, developed in coordination with the IAASB, include:

• Changes in key terminology, including a revised definition of the term “assurance client”;
• Amendments to certain independence requirements in light of the revised assurance client definition;
• Greater clarity as to the parties to an assurance engagement and their roles and responsibilities, and the related independence requirements that apply; and
• A clearer distinction between the types of assurance engagement covered in Parts 4A (addressing independence for audit and review engagements) and 4B of the Code.

Review the press release on the IESBA's website.

The topics addressed by these two recommendations are:

• Technology and complexity in the professional environment; and
• The impact of technology on auditor independence.

Stakeholder responses to the surveys will help guide the IESBA’s consideration of next steps in relation to those two topics at its December 2020 Board meeting.

The IESBA is seeking views and input from all categories of stakeholders, including investors and other users of financial statements, the corporate governance community, the regulatory and audit oversight community, preparers, firms, national standard setters, professional accountancy organizations, academics and others. Don’t miss this unique opportunity to contribute to international standard setting.

Click on the links below to respond to each survey:

1. Technology and complexity in the professional environment; and
2. Impact of Technology on Auditor Independence

Review the press release on the IESBA's website.

The merger is aimed at advancing the work of CDP, CDSB, GRI, IIRC and SASB who in September 2020 released a statement of intent to work together towards comprehensive corporate reporting in a comprehensive corporate reporting system.

The press release notes that Value Reporting Foundation will maintain the IIRC integrated reporting framework that describes all relevant value creation topics and the approach to integrating them in corporate reporting while the SASB standards provide the precise definitions of the data that should be reported for these topics in each industry. The framework and the standards will remain complementary tools with the Value Reporting Foundation facilitating the use of both together.

The merger responds to the ever increasing calls from global investors and corporates to simplify the corporate reporting landscape by having a globally aligned reporting system. The press release stresses that the Value Reporting Foundation, which will be formed by mid-2021, stands ready to work with the IFRS Foundation, IOSCO, EFRAG, CDP, CDSB, and GRI, and others to work towards a set of global and globally accepted standards.

Review the press release on the SASB’s website (an identical press release is available on the IIRC website).

With business resilience tested more than ever before due to COVID19, the report sets out the IIRC’s commitment to support businesses using integrated thinking and reporting to navigate these testing and uncertain times, which is bringing to the fore the importance of a multi-capital mindset and, in particular, consideration of human and manufactured capitals.

During 2019, the IIRC saw continued growth in the adoption of integrated reporting, with the concept of integrated thinking articulated and evolved further through the work of its Integrated Thinking and Strategy Group.

Review the full report on the IIRC's website.

While changes to the 2018 UK Corporate Governance Code raised the bar considerably and have led to some high-quality reporting, greater focus is needed on longer term sustainability including stakeholder engagement, diversity and the importance of corporate culture. These changes are expected to take time to bed in. The UK Corporate Governance Code was updated to help build trust in business by forging strong relationships with key stakeholders. It called for companies to focus on long-term sustainability by aligning purpose, strategy and culture, promoting integrity and valuing diversity.

Review the press release and report on the FRC's website.

In letters addressed to the Chief Executive Officers and Chairs of Boards of Directors, the investors specifically warned companies to ensure their climate lobbying is consistent with the Investor Expectations on Corporate Lobbying on Climate Change released last year. The investors urged companies to ensure all lobbying activities — both direct lobbying by the companies and indirect lobbying through their trade associations — are Paris-aligned and to take action when there is misalignment.

Review the press release on the Ceres' website.

To inform its work, the SFN drew on a survey of the initiatives planned or undertaken by securities regulators and market participants to address the opportunities and challenges posed by sustainable finance. The report reflects the expectations from regulators and market participants that IOSCO should take an active role in facilitating global coordination and addressing transparency. The report notes:

[T]he SFN work to date points to a need to improve the comparability of sustainability-related disclosures. The lack of consistency and comparability across third party frameworks could create an obstacle to cross border financial activities and raise investor protection concerns.

The SFN has identified several actions that could contribute to enhanced comparability of sustainability related disclosure:

• Alignment of frameworks and requirements
• Identification of relevant components of disclosure
• Increased public accountability and assurance standards
• Increased engagement with asset managers on the integration of ESG factors in investment decision processes

Building on these, the report sets out the role that IOSCO can play and a proposal for next steps:

In response to these demands, IOSCO is looking to play an important role in addressing the challenges identified by the SFN while avoiding duplicating work done or being carried out by other standard-setting bodies or similar organizations. In particular, facilitating the provision of disclosure, both qualitative and quantitative, that is decision useful for both investors and companies is an area where IOSCO should be able to contribute meaningfully.

Therefore, IOSCO has decided to establish a Sustainability Task Force (STF). With a view to improve sustainability–related disclosures made by issuers and asset managers, the STF will identify and develop categories of disclosure which are material for investors and which are capable of falling within the supervisory and regulatory competence of securities regulators. The STF will then examine the categories of disclosure to assess whether industry specific or more broad metrics would provide decision useful information and comparability between different issuers. For this work, the STF will engage with the industry, voluntary third-party disclosure standard-setters and other relevant organisations.

Please click for the press release and the final report on the IOSCO website.

Every year we depend on technology to help us store and manage various types of data for various purposes. Along with that comes the responsibility for managing it appropriately and according to IT governance best practices, which is a relatively new issue for boards to address. The responsibility for overseeing the management of electronic processes falls to the board of directors. This is no small task due the large number of individuals and employees that need to access the organization’s data on a regular basis.

Review the checklist on the Board Effect's website.