The arrival of November means the 2021 United Nations Climate Change Conference, better known as COP26, is finally taking place. It couldn’t have come at a more opportune time. August’s IPCC report highlighted the severity of the dangers posed by climate change. If we are unable to limit the rise in global temperatures to 1.5°C, the report states, there will be lasting damage to the planet. For the first time, the IPCC also made explicit the link between climate change and human activity.
For the past two years, mitigating the effects of the pandemic has rightly taken precedence globally. But it means we’ve lost precious ground on tackling climate change and, with the IPCC expecting the 1.5°C tipping point by 2040, there is added urgency to make the event count.
There’s a crucial role for accountants to play here. CAs have a responsibility to behave in an ethical manner and act in the public interest and that naturally extends to the environment. Are you discussing sustainability internally and with clients? And, if so, is that translating into actions that benefit society and the planet?
CAs will empower decision-making that supports business, investor, customer and environment alike. It’s a win-win.
Some CAs might see sustainability as living on the fringes of accountancy. That’s when the business case seals the deal. At a simple level, if you’re considering the efficiency of energy usage and the necessity of business travel, then you’re already having a positive impact on a company’s bottom line. But more broadly than that, climate-related risks are growing in severity and frequency, and often aren’t fully priced into assets and financial models. For economies to operate as efficiently as possible, creating profits that best reflect how we interact with the world around us, more data is needed on the environment and climate. And the measurement and analysis of data is the field in which CAs are expert. CAs will empower decision-making that supports business, investor, customer and environment alike. It’s a win-win.
As an educator and organisation of business influence, ICAS is here to help the transition to a more environmentally focused world. New skills and knowledge will be needed to ensure CAs can advise clients on climate-related issues. ICAS needs to ensure CAs feel confident in this area.
For those training to become a CA, that means integrating sustainability content in the teaching syllabus, which begins this year. For current CAs, we’re building a suite of dedicated courses to assist CPD in this field. We’re also extending this, where relevant, to CPD for some of the more traditional accounting disciplines, such as tax and financial reporting. It means all CAs will be able to stay abreast of the developments transforming their sector.
ICAS must also act in the public interest. That means collaborating with and influencing governments, regulators and standards setters to help shape the profession and business in general, particularly in emerging areas like sustainability, which require careful attention. In doing so, ICAS aims to represent members to ensure all parties reach a workable and appropriate outcome. This helps to maintain the profession’s position as a trusted voice, and contribute positively to global debates around the changing ways that people live and work.
It’s why, this year, we have taken several actions to share our commitment to fighting climate change. In July, we launched 1,000 Accountants for Net Zero alongside ICAEW and Chartered Accountants Ireland. The campaign aims to celebrate the CAs making a difference at their firms or with their clients. In August, ICAS became the first accountancy body to sign up to Terra Carta, a charter launched by the Prince of Wales that aims to reorient the private sector around sustainability.
And, just a few weeks ago, we became co-signatories of the Accounting for Sustainability net-zero commitment. In the coming 12 months, we will set out a pathway to net zero. We hope that sharing ICAS’ journey will encourage CAs to champion sustainability and contribute momentum towards avoiding that 1.5°C.