Understanding the Government’s consultation on creating a registration regime for sustainability assurance providers in the UK is important. The consultation could determine the future credibility and comparability of sustainability-related financial disclosures.

On 25 June 2025, the Government published three consultations seeking views on UK sustainability reporting in three core areas. The consultation on sustainability assurance in the UK is one of the three consultations. For a summary of the three consultations, read our previous article, A trio of consultations: The UK government consults on sustainability reporting requirements and transition planning.

What is the purpose of the consultation on sustainability assurance?

The consultation seeks views on establishing a voluntary registration regime for sustainability assurance providers in the UK. 

At present, there is no formal accreditation regime for sustainability assurers, perhaps leading to inconsistency, varied methodologies and skills. The aim is to enhance the quality, consistency, and oversight of assurance over sustainability-related financial disclosures, to provide investors with credible, decision-useful information about sustainability and climate-related risks and opportunities.

What is proposed?

The Government has proposed a new legal category of “sustainability assurance provider”, which would be profession agnostic. This means that both the sustainability consultancies and the traditional auditors (who are both currently performing this role) could become accredited, provided they meet criteria set by the new Audit, Reporting and Governance Authority (ARGA). 

Registration would be voluntary at this stage, with ARGA responsible for maintaining a public register, setting eligibility criteria, monitoring performance and enforcing standards.

How will the proposed regime interact with international standards and regulations?

The regime is designed to recognise providers as capable of assuring disclosures against multiple frameworks, including the future UK Sustainability Reporting Standards (UK SRS) and the Task Force on Climate-related Financial Disclosures (TCFD). 

The Government intends that registered providers will follow international standards such as the International Standard on Sustainability Assurance (ISSA) 5000, ensuring alignment with global best practice and supporting UK providers in servicing international clients.

What are the implications for asset managers?

In theory, enhanced oversight and standardisation of assurance providers will help ensure that the information asset managers rely on for investment decisions is robust and trustworthy. In turn, their investors, should have a greater degree of confidence in the quality and comparability of sustainability-related financial disclosures which the managers disclose.

In the longer term, if assurance over sustainability disclosures becomes mandatory, asset managers can expect a more consistent baseline of assured information across the market, further supporting effective capital allocation and risk management.

However, in practice, this additional oversight could lead to increased costs of assurance providers. These costs are likely to be passed onto managers in the form of an increase in the costs of their services. 

Should the regime remain voluntary, investors may still specify a requirement that sustainability data that they receive is assured by an accredited provider, hence, it is worth managers being cognisant of the developments in this area, so that they can have conversations with investors on their expectations. 

Will registration be mandatory in the future?

While the current proposal is for a voluntary regime, the Government is considering whether to mandate assurance for companies subject to future mandatory UK SRS disclosure requirements. Market views are being sought on whether mandatory assurance would be desirable and how it might be implemented, including potential timelines and costs.

Timing and next steps

The consultation is open for responses until 17 September 2025 for market participants to share their views on the proposed regime, its design, and its potential impact.