Institute of Internal Auditors Commends NACD on Identifying Vital Role of Independent Internal Audit Function for ESG Disclosures

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Jan 25, 2022, 08:30 ET

LAKE MARY, Fla., Jan. 25, 2022 /PRNewswire/ -- The Institute of Internal Auditors (IIA) issued the following statement from IIA president and CEO Anthony Pugliese, CIA, CPA, CGMA, CITP in response to the National Association of Corporate Director's (NACD) recent 2022 Governance Outlook Report, which took the important step of specifically identifying the internal audit function and its relevance to ESG corporate disclosures.

"The independent internal audit function is absolutely critical in providing objective assurance, independent of management, that established risk management, internal control activities and governance processes are properly designed and operating effectively. This objective assurance provides confidence to all stakeholders who use ESG disclosure data and that confidence benefits both organizations and capital markets. Internal auditors are already in place and uniquely positioned to provide this assurance from within an organization. We applaud the NACD and its members in their recognition of the independent internal audit function as part of the board's assessment of ESG governance strategies."

ESG initiatives and reporting demand sound governance practices, with the governing body, management, and internal audit working collectively to achieve objectives that facilitate strong governance and risk management for the benefit of all stakeholders. Internal audit is a key player in effective governance, as detailed in The IIA's Three Lines Model.

The IIA is committed to addressing the broader issues associated with ESG on a global level and advocating for the critical role of independent internal assurance.

The challenges and complexity of ESG reporting are abundantly evident, and the risks associated with poorly managed reporting can be high in terms of regulatory compliance and reputational damage. Within an effective governance structure, an independent internal audit is well resourced and positioned to ensure integrity, trust, transparency, compliance, and accountability. The IIA's International Professional Practices Framework (IPPF) includes globally recognized Standards and authoritative guidance that drive high quality internal audit work.

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About The Institute of Internal Auditors

The Institute of Internal Auditors (IIA) is the internal audit profession's most widely recognized advocate, educator, and provider of standards, guidance, and certifications. Established in 1941, The IIA today serves more than 210,000 members from more than 125 countries and territories. For more information, visit www.globaliia.org.

SOURCE The Institute of Internal Auditors