Sustainable Development Goals (SDG) & Environment, Social and Governance (ESG) Assurance: formula sheet

Key formulas

Structure of the 2030 Agenda

17 Goals → 169 Targets → Indicators

Goals are broad, targets are specific outcomes, indicators measure progress. Target year is 2030.

The 17 goals (short list)

1 No Poverty; 2 Zero Hunger; 3 Good Health and Well-being; 4 Quality Education; 5 Gender Equality; 6 Clean Water and Sanitation; 7 Affordable and Clean Energy; 8 Decent Work and Economic Growth; 9 Industry, Innovation and Infrastructure; 10 Reduced Inequalities; 11 Sustainable Cities and Communities; 12 Responsible Consumption and Production; 13 Climate Action; 14 Life Below Water; 15 Life on Land; 16 Peace, Justice and Strong Institutions; 17 Partnerships for the Goals

Learn the numbers with the names. Goal 13 (climate), 8 (work), 12 (consumption) and 16 (institutions) are most linked to business and audit.

Grouping memory aid

People (1-5) | Water and energy (6-7) | Economy (8-10) | Cities and resources (11-12) | Planet (13-15) | Peace and partnership (16-17)

This is a study aid, not an official UN grouping. Use it to recall the list.

SDG to ESG link

E → Goals 6, 7, 12, 13, 14, 15 | S → Goals 1-5, 8, 10 | G → Goals 16, 17

An indicative mapping for answers. Goals overlap, so say 'mainly' when you map.

ESG pillars

ESG = Environment + Social + Governance

Always give two or three examples of each pillar in your answer.

Materiality lens

GRI = impact materiality; SASB and IFRS S1/S2 = financial materiality

Fast way to separate the frameworks. BRSR is mandated disclosure by SEBI based on NGRBC principles.

TCFD four pillars

Governance | Strategy | Risk management | Metrics and targets

IFRS S2 follows this structure for climate disclosures.

BRSR structure

Section A (general) + Section B (management and process) + Section C (principle-wise, essential and leadership indicators)

Section C is based on the nine NGRBC principles.

BRSR Core

BRSR Core = selected KPIs from BRSR subject to reasonable assurance

Applies to prescribed listed entities on a phased basis; confirm current SEBI requirements.

Reasonable assurance conclusion

Positive form: 'In our opinion, the subject matter information is prepared, in all material respects, in accordance with the criteria'

Risk reduced to an acceptably low level. More extensive procedures.

Limited assurance conclusion

Negative form: 'Nothing has come to our attention that causes us to believe the information is materially misstated'

Risk is higher than reasonable assurance but meaningful. Fewer, less extensive procedures.

Preconditions for acceptance

Appropriate responsible party (roles and responsibilities) + suitable subject matter + suitable criteria available to users + access to sufficient appropriate evidence + rational purpose

If a precondition is missing, do not accept unless it can be fixed. Competence, independence and quality management are separate acceptance requirements, not preconditions. Do not accept the engagement if management imposes a limitation that is likely to lead to a disclaimer of conclusion.

Suitable criteria attributes

Relevance, completeness, reliability, neutrality, understandability

Use these to test whether the framework or basis is suitable.

Assurance engagement risk

Engagement risk = risk of expressing an inappropriate conclusion when the information is materially misstated. It comprises the risks of material misstatement (inherent risk and control risk) and detection risk.

This is a concept, not a numeric formula. Reasonable assurance requires engagement risk to be acceptably low. Limited assurance involves a higher acceptable level of engagement risk, which is reflected in less extensive procedures.

Responsibility split

Management prepares and owns the ESG information; the practitioner expresses a conclusion on it

Never say the assurance provider is responsible for the ESG report content.

Levels of assurance

Limited assurance = negative-form conclusion; Reasonable assurance = positive-form conclusion

Limited gives a lower, meaningful level of confidence; reasonable gives a high but not absolute level.

Greenwashing risk response

Claim → evidence → balance → clear reporting of scope

Use this chain to structure any greenwashing answer.

Challenge headings

Greenwashing + Data reliability + Criteria/boundary + Skills/expert use + Ethics

Five headings cover most descriptive questions on challenges.

Quick revision

• SDGs are 17 UN goals adopted in 2015 with a 2030 target date.
• ESG stands for Environment, Social and Governance; each pillar has its own metrics.
• A reporting framework supplies the criteria against which ESG information is measured and assured.
• Assurance gives users confidence in the information; it does not make the entity's strategy good or bad.
• Limited assurance gives a moderate level of comfort and is reported in negative form; reasonable assurance gives a higher level and is reported in positive form.
• Limited assurance involves fewer procedures than reasonable assurance, mainly enquiry and analytical procedures.
• Check first that the criteria are suitable and the subject matter is identifiable before accepting the engagement.
• The practitioner must be independent and competent; ESG work may need experts, so evaluate their competence and objectivity.
• Obtain written representations from management on the information and its preparation.
• Key risks include unsuitable criteria, weak data systems, estimation uncertainty and greenwashing.
• Non-financial data is often outside the accounting system, so test the controls over how it is collected.
• Always end a case answer with a clear conclusion on the type of report or action.

Common mistakes

• Saying there are 17 targets or 169 goals. Fix: Remember goals are few (17) and targets are many (169).
• Listing goals without linking them to the entity in the case. Fix: For each goal named, add a clause tying it to the entity's activity or risk.
• Saying GRI and SASB are the same because both cover ESG. Fix: Remember audience and materiality: GRI is multi-stakeholder with impact materiality; SASB is investor-focused, industry-specific, with financial materiality.
• Treating IFRS S2 as covering all ESG topics. Fix: S1 is general sustainability-related disclosure; S2 is climate-specific.
• Writing that limited assurance means no evidence is gathered. Fix: Say that sufficient appropriate evidence is still needed. Only the extent of procedures is lower, so the risk of an incorrect conclusion is higher.
• Using the positive form conclusion for limited assurance. Fix: Limited assurance uses negative-form wording; reasonable assurance uses a positive-form opinion.
• Saying the assurance provider is responsible for the ESG disclosures. Fix: Write that management is responsible and you express a conclusion on it.
• Treating greenwashing as only a management problem. Fix: Explain that your report can lend false credibility, and give the procedures and wording that reduce this.

Exam tips

• Know the count: 17 goals, 169 targets, adopted in 2015, target year 2030. These are easy marks in MCQs.
• In case scenarios, match the fact to the goal title first. Then write the link to the entity in one clause.
• Use the ESG tag (E, S or G) with each goal to show you understand how SDGs connect to the chapter.
• For role-of-CA questions, use a fixed list: measure, report, assure, advise, uphold ethics. Add the case fact to each point.
• Keep answers to this topic short and structured. Bullets with goal numbers score better than long paragraphs.
• Prepare a one-page comparison table in your own notes: framework, audience, materiality, scope.
• In case MCQs, look for the audience and the word climate to pick the framework quickly.
• Always link the framework to assurance in the last line of a written answer.