Leading auditors support the goal proclaimed by politicians to ensure a sustainable restructuring of the economy with rules and key figures.

"This challenge must be accepted," said Melanie Sack, deputy spokeswoman for the board of auditors IDW, at an information event on Tuesday.

"From our point of view, this is an opportunity," said Klaus-Peter Naumann, spokesman for the IDW.

"We have to ensure trust in these instruments," Naumann urged the auditing industry.

According to Bernd Stibi, IDW Accounting Manager, time is of the essence.

"Trust can be lost quickly," Stibi said.

Mark Fehr

Editor in Business.

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In practice, it is about the new and increasingly complex rules for the presentation and control of sustainable business models.

These not only concern the companies, but also their auditors.

Because they should check whether companies report on the environmental and climate compatibility of their activities and their impact on human rights in accordance with international and European standards.

The point of the exercise: In the future, investors should only invest their money in ESG-compatible companies, according to the wishes and ideas of politicians.

The abbreviation ESG stands for the major social goals of this time, i.e. environmental and climate protection, social solidarity and corporate management without corruption or fraud.

ESG comparisons are also difficult in the insurance industry

Despite all the support for these goals, the auditors do not hide the fact that there are still many unresolved issues with regard to sustainability and its audit.

"The test cannot be better than the target object," said IDW vice spokeswoman Sack.

"You have to see it as a journey," said the auditor Kristina Stiefel from the auditing company PWC, with a view to the first experiences with the sustainability assessment of financial companies such as banks and insurance companies.

The European Union requires companies to provide transparent reports on environmental protection, social issues and the prevention of corruption along the entire value chain.

This requirement, which initially only applied to large listed companies, was extended to medium-sized companies, so that around 15,000 companies are affected.

In its taxonomy regulation, the EU demands accountability for the share of sustainable business in a company's sales, as well as its investments and operating expenses for assets and ongoing processes.

In practice, this can mean that large companies have to calculate these three key figures for 25 different business areas.

Open questions and soft definitions

But how meaningful is a high or low value of such a key figure?

This question is difficult to answer because the EU taxonomy requires that sustainable business activity promotes an ESG objective, such as environmental protection, without compromising another ESG objective, such as human rights.

For example, hydropower protects the climate because it generates electricity without emitting carbon dioxide.

On the other hand, the construction of a dam requires a major intervention in nature, which impairs the protection of the environment.

According to the IDW information event, open questions can also ensure that a telecommunications company, for example, reports a high ESG share of 70 percent, while a competitor with almost the same business model reports a significantly lower share of only 30 percent.

In this case, a high ESG value could be achieved simply because a company classifies a large part of its sales as green on the grounds that its users can do without energy-intensive business trips thanks to telephone conferences.

ESG comparisons between companies are also difficult in the insurance industry.

According to the auditor Stiefel, legal protection insurers hardly have any business that is suitable for taxonomy, whereas household contents insurers, for example, could show a connection to the climate because of the protection against storms and natural disasters.

Because the audit of sustainability is becoming as important as the classic audit of the balance sheet, the role of the auditor is likely to change.

"This will also permanently change the job description of the auditor," expects IDW board spokesman Naumann.

The auditors' guild, which is suffering from a shortage of skilled workers, hopes to be able to attract more young people to the profession thanks to the forward-looking ESG task.