As regulatory expectations and stakeholder demands increase, the ability to demonstrate real progress towards net zero is no longer a nice-to-have. It is becoming a business imperative.
Yet one of the most overlooked threats to credibility lies not in the data itself but in how that data is verified.
"Organisations are under pressure to disclose more and to do so with clarity, accuracy and integrity,” says Olga Rivas, Technical Director, ESG at LRQA. “But the way assurance is being approached often doesn’t match the complexity of what is being reported. A traditional mindset is not always fit for purpose when it comes to sustainability.”
The regulatory shift: from optional to essential
Over the past 24 months, regulators across major economies have introduced mandatory sustainability disclosure requirements that include some form of third-party assurance. The European Union’s Corporate Sustainability Reporting Directive (CSRD), the US Securities and Exchange Commission (SEC) Climate Rule and California’s Climate Accountability Package (SB 253 and SB 261) all include obligations for independent review of greenhouse gas (GHG) emissions and broader environmental, social and governance (ESG) data.
For example:
- The SEC’s final rule, published in March 2024, requires limited assurance of Scope 1 and 2 emissions from 2025, increasing to reasonable assurance for large filers from 2029.
- The EU’s CBAM regulation mandates verified embedded emissions data for carbon-intensive imports, using accredited verifiers under Implementing Regulation 2023/1773.
- California SB 253, coming into effect in 2026, requires large companies doing business in the state to report and verify Scope 1, 2 and 3 emissions data.
Across all of these frameworks, the key message is clear: data must be independently verified and increasingly, it should be done by people who understand sustainability,” explains Olga. “Financial audit firms are not the only option and in many cases, they may not be the best one.”
What’s at stake: credibility, compliance and cost
Sustainability data is fundamentally different from financial data. It is often estimated, derived from third-party sources or dependent on evolving methodologies. This complexity introduces both technical risks and reputational risks, especially as scrutiny intensifies.
According to the United Nations Environment Programme, over 1,400 climate-related lawsuits have been filed globally, with a sharp rise in cases targeting greenwashing and misleading environmental claims. At the same time, research consistently shows that a majority of consumers now take environmental impact into account when making purchasing decisions. However, this influence depends heavily on the clarity and credibility of the information provided.
“We’re seeing a growing trust gap,” says Olga. “Stakeholders want to believe the numbers, but they need assurance that those numbers are real, consistent and externally verified. That’s where independent ESG assurance becomes a critical differentiator.”
Why not all assurance is equal
Despite regulatory flexibility, many organisations default to their existing financial auditors to provide ESG assurance. According to the Center for Audit Quality, 95% of S&P 500 companies seeking assurance used the same firm that performed their financial statement audit. This reliance may seem efficient, but it can dilute the level of ESG-specific rigour applied. Financial audit methodologies often overlook sector-specific risks, non-financial materiality and evolving standards or European Sustainability Reporting Standards (ESRS) metrics. This creates a false sense of assurance. One that may not stand up to stakeholder or regulatory scrutiny.
“We’ve worked with clients who initially assumed they needed to use a financial auditor for everything, only to discover that approach was both more expensive and less insightful,” says Olga. “An ESG specialist brings sector knowledge, methodological clarity and the right tools for the job. Independent providers like LRQA apply assurance approaches that are built around sustainability frameworks, including:
- ISO 14064 for GHG verification
- GHG Protocol for corporate carbon accounting
- European Sustainability Reporting Standards (ESRS)
- Science Based Targets initiative (SBTi) guidance
- Sector-specific schemes like CBAM and CDP
This ensures that data is assessed in the right context, aligned to global standards and backed by meaningful evidence.”
What this means for you
If your organisation is preparing for CSRD, SEC, or California climate legislation, now is the time to review who is assuring your data, what standards are being applied and whether those methods are fit for purpose. Consider whether your assurance provider has the technical and sector knowledge to withstand stakeholder scrutiny.
The case for independent ESG assurance and financial disclosures
At LRQA, we advocate a dual-assurance approach: financial disclosures should be reviewed by financial auditors, while ESG data should be assured by sustainability specialists.
This model delivers three clear advantages:
- Improved credibility: ESG data is reviewed by experts in sustainability, not generalists.
- Cost efficiency: ESG-specific methodologies are leaner and avoid the overhead of traditional audit processes.
- Regulatory alignment: LRQA’s services are fully recognised under major regulations, including CSRD, SEC and CBAM.
"Independent ESG assurance is not just about compliance,” says Olga. “It’s about building confidence, internally and externally, that your net zero strategy is grounded in evidence, not estimates.”
Stronger assurance, stronger outcomes
Net zero is a long-term commitment, but success depends on what happens in the short term: the data you disclose, the claims you make and the trust you build. With increasing stakeholder scepticism and evolving legal risks, relying on outdated assurance models could expose your organisation to unnecessary challenges.
“The most resilient companies are those that treat ESG data with the same rigour as financial data,” Olga concludes. “But they also recognise that the right expertise makes all the difference. Not all assurance is equal and in today’s climate, that distinction really matters.”
If your organisation is reassessing its net zero assurance strategy, ensure that your approach meets not only regulatory requirements but also stakeholder expectations. The right partner should bring more than a checklist, they should bring clarity, credibility and confidence.
