www.pwc.

com

Sustainability and
Internal Audit
Innovating to add value
21 April 2016
www.pwc.com

How Internal Audit can

innovate to add value
in an area that is
becoming increasingly
more significant in the
eyes of its stakeholders
www.pwc.com

OR

Why is Internal Audit

IGNORING Sustainability?
Sustainability 101

Sustainability and Internal Audit 21 April 2016

PwC
 What is sustainability?
Its about caring for the
Its about Greenhouse
community, and
Gases! Buy me a Tesla.
charitable giving.

Its about water use, we Its a USP for our brand,

live in the desert! it builds our reputation
and helps us earn extra
revenue.
Its about how much
waste we create, give me Its a way to cut costs,
more recycling bins! save money.

Sustainability and Internal Audit 21 April 2016

5
What is sustainability?

Its all the above, its about

maintaining relevance
Sustainability and Internal Audit 21 April 2016
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Why is sustainability important? (Or
why should I care?)

Sustainability and Internal Audit 21 April 2016

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Why is sustainability important?

Pull out of an important

Revenue Cut costs statistic goes in this area
11pt Georgia italic (white)
driver

Build Manage
Reputation risks

Sustainability and Internal Audit 21 April 2016

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What should we be focusing on?

Sustainability and Internal Audit 21 April 2016

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What should we be focusing on?

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What should we be focusing on?

It depends on where you are in your journey, but here

are a few examples:

Sustainability strategy;
Governance, risk and compliance;
Assurance and reporting; and
Supply chain and operations.

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What should we be focusing on?

1) Sustainability strategy

Developing and integrating a detailed sustainability vision into a

long term strategic plan in a way that creates lasting value is a
challenge. A strategy should:

Identify issues and goals;

Map short and long term ambitions, assess the risks and identify
gaps in delivery, whilst explaining how targets will be achieved;
Support the alignment and integration of a sustainability vision;
and
Develop and deliver a robust sustainability programme that
includes prioritized initiatives, enablers, key performance
indicators and measurable time-bound targets.

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What should we be focusing on?

2) Governance, risk and compliance

There is a growing need to establish governance around

sustainability. A well governed company will:

Develop codes of conduct, policies and procedures;

Win employee buy-in to the sustainability strategy; and
Manage risks and regulatory compliance and understand the
impact of these on your companys strategy and operations.

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What should we be focusing on?

3) Assurance and reporting

Leaders understand the importance of setting bold sustainability

metrics and making sure that open and timely reporting accurately
reflects progress made. Companies reporting Sustainability should:

Identify and assess relevant requirements of stakeholders;

Undertake Internal Audits to gauge the effectiveness of Internal
Controls and measures;
Provide assurance of data in a sustainability report;
Review submissions to sustainability indices;
Review current reporting against best practices and identify
operational improvements; and
Align measurable sustainability objectives against strategic aims.

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What should we be focusing on?

4) Supply chain and operations

Companies are looking at the impact their organizations have on the

environment, as well as the positive or negative impact on the
communities in which they operate. Companies should:

Assess the risks associated with their supply chain and the steps
necessary to protect their brand;
Consider best practice from across a range of industry sectors;
Define characteristics required from suppliers in order to make
sure theyre sustainable; and
Monitor and manage environmental, social and governance risks
associated with your supply chain.

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Assurance and reporting
The basics Sustainability / CSR reports

Environmental
KPIs
People Case
studies

Community Suppliers A chance to

development tell your
story

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Assurance and reporting
The basics Sustainability / Assurance Reporting
Standards Criteria
CSR reports

ISAE 3000 Used to set

out how a
ISAE 3410 company
calculates
AA1000AS their figures

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 Sustainability and Internal Audit
In summary

Internal audit can help an entity determine where

they are on their sustainability journey, identify
what is missing and make recommendations to
management

We can test the accuracy and consistency of

sustainability data included in reports

We can verify if data is presented in line with a

reporting criteria

Internal Audit can educate the Audit Committee and

management and help them better exercise their risk
oversight responsibilities.

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Sustainability and Internal Audit
Innovating to add value

Questions?
Sustainability and Internal Audit 21 April 2016
PwC 19
Thank you all for attending!
James Munt
James.munt@ae.pwc.com
+971 (0) 56 417 6711

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