“It Would Be Interesting to See Assurance Statements with Qualifications” : Assurers’ Perspectives on Sustainability Assurance Engagements and Client Relationships

Abstract: The proliferation of sustainability reporting has been accompanied with stakeholders’ concerns over the credibility of sustainability reports. This worry has resulted in the assurance of sustainability reports and accordingly, professionals have sought to create a new auditable market and academics to understand this phenomenon. Though previous research has shown that assurers and clients jointly decide the terms of the engagement, assurers’ perceptions of sustainability assurance and assurer–client relationships, in which the engagement takes place, have been overlooked. We try to close this gap by conducting an interview-based study which firstly, examines how assurers view and experience sustainability assurance engagements and secondly, investigates how assurers characterize their relationship with clients. We lead 12 interviews with assurers working for either Mazars, BDO, Grant Thornton, or RSM, covering 11 countries worldwide.   The empirical findings indicate that assurers work with sustainability reports that are unbalanced and inaccurate. Particularly, they view the inaccuracy of nonfinancial data as a challenge to the issuance of sustainability assurance statements. We find that inaccuracy is perceived difficult because assurers lack technical expertise and are unpracticed in auditing qualitative information. Further, when assurers cannot verify the disclosed information, they rather terminate the engagement than issue a presumably misleading assurance statement. The termination of an engagement is, however, the ultimate response and until then, assurers collaborate with the client to be able to issue an assurance statement. Hence, collaboration is considered key to the completion of a sustainability assurance engagement. This research contributes to a better understanding of practitioners’ perspectives on sustainability assurance engagements both practice and relationship-wise. We also develop practical implications and future research avenues.