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International Auditing and Assurance Standards Board 2024-2027 strategy consultation

Letter to the International Auditing and Assurance Standards Board, 4 April 2023.

We refer to the consultation on the Proposed Strategy and Work Plan for 2024-2027 of the International Auditing and Assurance Standards Board (IAASB), published in January 2023. We welcome the opportunity to contribute our perspective on the IAASB’s strategy and priorities for the coming years through this consultation.

Norges Bank Investment Management (NBIM) is the investment management division of the Norwegian Central Bank and is responsible for investing the Norwegian Government Pension Fund Global (the fund). NBIM is a globally diversified investment manager with 12,429 billion Norwegian kroner at year end 2022. We are a long-term investor, working to safeguard and build financial wealth for future generations.

NBIM welcomes the IAASB’s objective to establish globally accepted standards for assurance on sustainability reporting. Reliability and credibility of information provided in companies’ sustainability reports is crucial for us as a global investor. Global standards for assurance of sustainability reports will be key to enhance the quality of the information provided to markets and used by investors and other stakeholders. It is important to recognise that many companies are new to sustainability reports, and therefore flexible and principle-based standards are particularly important to allow preparers and assurers to get familiar with sustainability reporting. Regarding the potential development of further standards for assurance on sustainability reporting beyond the overarching ISSA 5000 standard, evaluation of market response and implementation of the latter could facilitate the assessment of which specific aspects of the sustainability assurance engagements might need more granular requirements.

Regarding the other strategic objectives, we support the IAASB’s aim to strengthen coordination with other leading standard setters. Coordination with the International Sustainability Standards Board is particularly important given the rapidly evolving nature of sustainability reporting standards, and the need to ensure that they are assurable. We also welcome the IAASB’s work on professional scepticism and encourage the Board to consider how to embed it throughout its entire workplan and strategy. Exercising professional scepticism can help reduce corporate scandals and frauds, and address cases of greenwashing in the sustainability reporting space. Finally, we encourage the Board to focus on capacity building for auditors and other assurance practitioners. This is likely to be particularly necessary in the less mature and quickly evolving field of sustainability assurance.

We thank you for considering our perspective and remain at your disposal should you wish to discuss these matters further.

Yours sincerely,

Carine Smith Ihenacho
Chief Governance and Compliance Officer

Elisa Cencig
Senior ESG Policy Adviser

Download the letter (pdf)