The Evolving Landscape of Sustainability Reporting and Verification

IEMA has recently published new guidance for sustainability reporting entities on verification and validation, authored by IEMA members Lucy Candlin, Helen Sprakes and Mairi Dorward. Senior policy and engagement lead Chloë Fiddy explains the background and scope of the paper.

As pressure grows on companies to publish climate-related financial disclosures, there is a corresponding requirement for these disclosures to be useful for a range of purposes. Financial institutions looking for sustainable investment opportunities look closely at risk management and need the disclosures to be comparable between entities and trustworthy as a basis for decisions. Governments need the financial and non-financial data in the reports to be accurate as a sound basis for taxation – for example as part of the existing Emissions Trading Scheme (ETS) and for the forthcoming Carbon Border Adjustment Mechanism (CBAM).

Reporting on Greenhouse Gas (GHG) Emissions provides information on the environmental impact of companies and other entities, many of which are subject to mandatory and/or voluntary reporting. We are also seeing instances of market-driven requirements for the purposes of investor assurance. Stakeholder trust is enhanced by improved transparency in reporting.

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Thankfully, there is growing standardisation amongst the sustainability frameworks meaning that the disclosure requirements are converging. These are aided by advances in digital reporting and data tagging, enabling greater certainty around compliance and accountability. 

Reporting is mandatory under the European Sustainability Reporting Standards (ESRS) and as the quest for standardisation continues, governing bodies are increasingly adopting the frameworks published by the International Financial Reporting Standards (IFRS) Foundation as their regulatory standards. As these frameworks evolve there is a welcome movement towards reporting consistency.  

Verification and validation are essential for the data accuracy and reliability of these reports. Third-party assurance of reports enables reporting entities to demonstrate that they are on top of their environmental compliance and sustainability commitments.  

Verification involves examining historical data for accuracy and to rule out material errors, while validation assesses the methods used for future projections. This assurance process is crucial, particularly as sustainability data is increasingly scrutinised by regulators, investors, and consumers. For example, the European Commission will soon require reasonable assurance levels on certain disclosures, and the U.S. SEC mandates limited assurance or moderate assurance for GHG data. 

IEMA's latest guidance outlines key steps in preparing for verification, including defining objectives, establishing verification criteria, data sampling and ensuring data accuracy. Companies may choose different assurance levels based on cost and need, from high assurance with detailed scrutiny to lower levels focusing on the reporting process. 

As sustainability reporting becomes more regulated, verification will play a pivotal role in ensuring data integrity. IEMA remains committed to supporting members in navigating these evolving requirements.

IEMA members can download their copy of 'Verification and Validation' here

Non-IEMA members can purchase the document from our online shop (under 'Sustainability in Practice Guides')


Published by:
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Chloë Fiddy

Senior Policy and Engagement Lead

Chloë is the Senior Policy and Engagement Lead for Climate Change and Energy at IEMA. Within this remit she works on projects relating to greenhouse gas reporting and transition planning and reporting, as well as adaptation. She is particularly interested in finding practical solutions and approaches which lead to standardised, replicable and trustworthy reporting, so that decision-makers have better data to work with. Previously Chloë has worked at senior levels in the manufacturing and retail sectors, and in climate and sustainable development planning roles in the public sector. Her prior business experience and her understanding of the way that the public sector functions inform her approach to climate change and energy and social sustainability policy and engagement at IEMA. She is a Trustee on the board of Uttlesford Citizens Advice and a District Councillor and is active in her community. In her spare time she enjoys live music and cooking for family and friends.