11th Colloquium

Equivalence

between sustainability reporting standards

The future of sustainability reporting standard convergence.

Memorandum - summary of the key messages
  • 16 May 2024

Background

“the fact or state of being equal in value, amount, meaning, importance, etc.”

Oxford Learner’s Dictionaries

Equivalence and convergence in financial reporting standards

In 2001, the International Financial Reporting Standards Foundation (IFRS), and its International Accounting Standards Board (IASB) was established. In June 2003, its first principles were developed and issued by it.

 

In 2007, the United States Securities Exchange Commission to waived the requirement for IFRS-based financial statements to be reconciled to US GAAP, allow foreign companies to submit financial statements to the Commission using IFRSs as adopted by the IASB.

 

In 2008, the European Commission prepared a report on the process of converging the Generally Accepted Accounting Principles (GAAPs) towards International Financial Reporting Standards (IFRS) and on the progress towards the elimination of reconciliation requirements. 

 

In 2019, the European Commission set out the “equivalence process”, on how the EU will assess a country’s regulation to determine if it can be deemed ‘equivalent’ with EU rules. Once in place, equivalence allows the EU to rely on the other country’s rules and supervision in a specific area of financial services, based on the relevant EU regulation.

 

Equivalence in financial reporting standards has narrowed cross-border divergences and incompatibilities, and helped reduce global market fragmentation. 

Equivalence and convergence in sustainability reporting standards

Today, although the Global Reporting Initiative’s Reporting Standards and the developing IFRS S-standards provide the world with international sustainability reporting standards, regional (e.g. the European Unions’s CSRD) and national sustainability reporting standards have been adopted, and many  more “informal” corporate standards for ESG reporting are in use by, for example, asset managers and investors.

This colloquium discusses the potential for the application of “equivalence”, as has been applied in financial reporting, to sustainability reporting.

Supplementary information

Opening of the Colloquium

Alan Johnson

Welcome by the Chair

Introduction to the 11th Colloquium topic

Key Note Presentations

Neil Stevenson

Equivalence and convergence in sustainability reporting

Josephine Jackson Head nd shoulders

ISSA 5000: Sustainability Assurance Engagements and Equivalence

Panel discussion

Hilde Blomme
  • Hilde Blomme
  • Deputy CEO
  • Accountancy Europe
Iheanyi Anyahara
  • Iheanyi Anyahara
  • Director Accounting Standards
  • Financial Reporting Council of Nigeria
Alan Johnson
  • Alan Johnson
  • Past President
  • International Federation of Accountants

Questions from attendees to the speakers

Carolynn Chalmers

Questions to the speakers from attendees

  • Carolynn Chalmers, CEO of the Good Governance Academy

Closing of the Colloquium

Alan Johnson

Closing by the Chair

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Alan Johnson

Chair of the Good Governance Academy

Alan Johnson is the immediate past President of the International Federation of Accountants (IFAC). He previously served as Deputy President from 2018-2020 and had been a board member since November 2015. He was nominated to the IFAC board by the Association of Chartered Certified Accountants (ACCA).

 

On January 1, 2021, Alan was appointed a non-executive director and member of the Audit and the Succession & Appointments Committees of Imperial Brands plc, a FTSE 100 company in the UK.

 

Alan is a former non-executive Director of Jerónimo Martins SGPS, S.A., a food retailer with operations in Portugal, Poland, and Colombia, having completed his board mandate in 2016. 

He is currently the independent chairman of the company’s Internal Control Committee. Previously he was Chief Financial Officer of Jerónimo Martins from 2012 to 2014.

 

Between 2005 and 2011 Alan served as Chief Audit Executive for the Unilever Group. He also served as Chief Financial Officer of Unilever’s Global Foods businesses and worked for Unilever for 35 years in various finance positions in Africa, Europe and Latin America.

 

Mr. Johnson was a member of the IFAC Professional Accountants in Business Committee between 2011 and 2015, a member of the ACCA’s Market Oversight Committee between 2006 and 2012 and chair of the ACCA Accountants for Business Global Forum until 2018. Alan was a member of the board of Gildat Strauss Israel between 2003 and 2004.

 

Mr. Johnson is the chair of the board of governors of St. Julian’s School in Portugal and chairs its Finance & Bursaries Committees.

 

In October 2016 he was appointed to the Board of Trustees of the International Valuation Standards Council and chairs its audit committee.

 

Between July 2018 and September 2020 he was a non-executive director of the UK Department for International Development (DFID) and chaired its Audit & Risk Assurance Committee.

Prof. Mervyn King

Patron, Good Governance Academy

Mervyn King is a Senior Counsel, former Judge of the Supreme Court of South Africa, and designated Chartered Director (South Africa). He is Professor Extraordinaire at the University of South Africa, Honorary Professor at the Universities of Pretoria and Cape Town, and a Visiting Professor at Rhodes University. He has honorary Doctorates from Wits University and Stellenbosch University in South Africa, Leeds University in the UK, and Deakin University in Australia.

 

Mervyn is honorary fellow of the Institute of Chartered Accountants of England and Wales; the Institute of Internal Auditors of the UK; the Chartered Institute of Management Accountants; the Certified Public Accountants of Australia; the Chartered Institute of Public Relations of the UK, and the Chartered Secretaries and Administrators.

 

Mervyn is Chair Emeritus of the King Committee on Corporate Governance in South Africa, as well as of the Value Reporting Foundation (incorporating the International Integrated Reporting Council and SASB) and the Global Reporting Initiative (GRI). He has received Lifetime Achievement Awards for promoting quality corporate governance globally, from several institutions.

 

Mervyn chairs the Good Law Foundation and has chaired the United Nations Committee of Eminent persons on Governance and Oversight. He is a member of the Private Sector Advisory Group to the World Bank on Corporate Governance and of the ICC Court of Arbitration in Paris. Mervyn currently chairs the African Integrated Reporting Council and the Integrated Reporting Committee of South Africa and is Patron of the Good Governance Academy.

 

Mervyn has been a chair, director and chief executive of several companies listed on the London, Luxembourg and Johannesburg Stock Exchanges. He has consulted, advised and spoken on legal, business, advertising, sustainability and corporate governance issues in over 60 countries and has received many awards from international bodies around the world including the World Federation of Stock Exchanges and the International Federation of Accountants.

 

He is the author of many books on governance, sustainability and reporting, the latest being “The Healthy Company.”

Carolynn Chalmers

Chief Executive Officer, Good Governance Academy

Carolynn Chalmers is the Chief Executive Officer of Professor Mervyn King’s Good Governance Academy and its initiative, The ESG Exchange. She has edited two international standards: ISO 37000:2021 – Governance of organizations – Guidance and its associated Governance Maturity Model, ISO 37004:2023.

 

Carolynn makes corporate dreams come true, assisting leaders and leadership teams in how to create value for their organisations. She makes use of her expertise and experience in corporate governance, organizational strategy, Digital Transformation, and IT to do so.

 

Carolynn is an Independent Committee Member of South Africa’s largest private Pension Fund, the Eskom Pension and Provident Fund, and recently retired as Independent Committee member of several board committees for the Government Employee Medical Scheme. Carolynn has extensive management, assurance and governance experience and has held various Executive roles for international, listed, private and public organisations across many industries.

 

Carolynn is best known for her successes in establishing governance frameworks, and designing and the leading large, complex initiatives that can result. She attributes this success to the application of good governance principles. She shares her insights on her 2 LinkedIn Groups – Applying King IV and Corporate Governance Institute. 

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