Preparing for Reasonable Assurance of Climate-Related Disclosures (Part 2)
11 Jul 2025
Reasonable assurance is not the daunting task some companies may perceive it to be. In Part 1, we explored what reasonable assurance entails and why it is important.
In Part 1, we explored what reasonable assurance entails and why it is important. Part 2 outlines the journey a company takes from the earliest stages to fully realizing the benefits of reasonable assurance, highlighting how consistent engagement can deliver lasting value and make the investment worthwhile.
We have categorized this journey into three general stages of “readiness”:
| Not Yet Started | Embarking | Already Doing |
|---|---|---|
| Companies that may not have conducted any form of assurance |
Companies that have completed limited assurance or an internal audit but not reasonable assurance, and are conducting their first exercise |
Companies that have completed at least one reasonable assurance cycle |
Figure 1: Categorization of a company’s reasonable assurance efforts
“Not Yet Started”: The Early Stage
For companies yet to begin climate-related assurance, establishing strong foundational data management practices is a critical first step.
Data management includes several key features:
- Data gathering: collecting and logging data as well as supporting evidence (e.g., activity data and evidence for greenhouse gas [GHG] emissions).
- Information management: reviewing mechanisms for data preparation (e.g., quality checks by management-level members).
- Establishing methodology: determining how to calculate output data (e.g., computing results according to the selected reporting standard[s]).
- Establishing documentation: determining how data will be tracked, recorded, and updated over time (e.g., drafting procedures for data collection and management).
Beyond regulatory compliance, these initiatives also open the door to significant opportunities for internal growth. Companies in this early stage can begin building momentum by focusing on the following key steps:
- Understanding reporting standard requirements. A clear understanding of the purpose of climate‑related disclosures—and any associated assurance requirements—helps companies structure their emissions inventories appropriately, including decisions about data quality and level of detail. This ensures alignment with the chosen reporting standard(s) and supports effective verification during the assurance process. After all, these disclosures are publicly reported for several critical reasons: to meet regulatory compliance, build investor and stakeholder trust, and support strategic risk management.
- Developing an information management system and process controls. Having an information management system tailored to handle the data for disclosure is critical. An effective system includes designated “champions” responsible for ensuring correct data entry, and—an often-overlooked component—a unified communication process for all participants in the reporting cycle. This harmonized approach helps align everyone on definitions, data points, reporting frequency, documentation procedures, and verification methods. This unified process, which will be reviewed under reasonable assurance procedures, is a cornerstone of company performance and streamlined operations.
“Embarking”: The Deepening Stage
Companies with experience in limited assurance or internal audits can confidently undertake their first reasonable assurance exercise, unlocking opportunities for long-term operational improvements. Key components of reasonable assurance include:
- Strengthening and widening systems and controls. Reasonable assurance can significantly enhance a company’s existing processes by providing a rigorous, independent evaluation of the accuracy and completeness of reported information, covering greater depth, breadth, and detail. A higher level of assurance involves more extensive testing and evidence gathering than limited assurance, helping to identify gaps, inconsistencies, or weaknesses in current controls. For example, deeper assurance efforts may uncover inconsistent emissions factors or varying documentation practices across different company sites. Addressing these issues builds stakeholder confidence and reinforces company credibility.
- Identifying opportunities to improve emissions. Reasonable assurance covers a wider range of emissions (or removals) sources—including those that may have been excluded (or missed) by limited assurance efforts. For example, fugitive emissions may be an immaterial GHG source for many companies; they may be excluded from the scope of limited assurance. However, air conditioning refrigerants, which are a source of fugitive emissions for many companies, possess enormous global warming potential, and their careful management can contribute substantially to reduced global emissions. Reasonable assurance procedures, such as site visits, can reveal such previously ‘unseen’ opportunities for improvement — or environmental risks — that can meaningfully contribute to reducing a company’s environmental impact.
“Already Doing”: The Fully Embedded Stage
Companies that actively pursue reasonable assurance can transform it from a compliance exercise into a catalyst for operational excellence. Reaching the “fully embedded” stage reflects sustained investment and effort, bringing benefits such as smoother audits, more reliable data, and increased confidence in decision‑making.
At this stage, companies typically experience a range of operational and assurance-related strengths, including:
- Streamlined operations for the entire company. Continuously conducting reasonable assurance creates a powerful foundation for long-term, company‑wide operational excellence. Standardized assurance procedures foster greater data accuracy, smoother workflows, and fewer errors, freeing up time, reducing duplication, and cutting unnecessary costs. What starts as a verification exercise evolves into a driver of efficiency and innovation: with each cycle, the company becomes more agile, more resilient, and better equipped to thrive in a dynamic, competitive landscape.
- Team alignment and deep trust with stakeholders. In the long term, reasonable assurance builds a culture of accountability and transparency, enhancing focus and collaboration across teams. As reporting processes improve, internal collaboration strengthens—teams begin to speak a common language, align on clearer goals, and operate with a shared sense of purpose. This internal cohesion extends outward, building deeper trust with investors, regulators, customers, and other stakeholders who recognize the company’s commitment to integrity and long-term value. Over time, this transparency transforms relationships into lasting partnerships and empowers the entire organization to move forward with confidence, unity, and purpose.
Start Early - Invest in the Future
What began as a regulatory obligation has evolved into something much more strategic—and potentially rewarding—for modern businesses. Reasonable assurance is no longer just about proving credibility and through climate disclosures; it’s also about future‑proofing the organization, managing risk, and improving internal operations. With early initial investment and thoughtful long‑term planning, the process becomes more efficient over time—and the benefits increasingly outweigh the costs.
