Under the Corporate Sustainability Reporting Directive (CSRD), there are two main types of auditing for compliance: limited assurance and reasonable assurance.
Limited assurance serves as a preliminary review of a company's adherence to CSRD standards, offering a basic level of scrutiny without deep investigative processes.
Reasonable assurance represents a more thorough and costly examination, ensuring a comprehensive verification of a company's sustainability reporting.
Currently, the CSRD mandates that companies undergo limited assurance to meet compliance requirements. This standard will remain in effect until October 1, 2028, by which time the European Union (EU) aims to introduce and enforce reasonable assurance criteria, provided it's deemed practicable for sustainability reporting audits.
The transition to an EU-wide approach for limited assurance is also on the horizon. Until October 1, 2026, limited assurance may adhere to national standards, allowing for variation across member states. However, post this deadline, the EU plans to establish uniform limited assurance standards across all member states, marking a significant step towards harmonization in sustainability reporting audits.