Internal Auditor's Role in ESG Disclosure and Assurance : An Analysis of Practical Insights

Using a dataset of 107 internal auditors, we investigate internal audit functions' (IAF) role in environmental, social, and governance (ESG) matters. We give evidence for organizations' and IAFs' ESG maturity driving ESG reporting, while IAFs' involvement in ESG drives assurance of ESG reports. Our results support the notion that the environmental pillar is perceived as the core element of sustainability with the highest risk, therefore propelling the need for assurance. The imbalance between assurance and consulting activities stresses the potential to position the IAF as a value-adding entity in a complementary relation towards external auditors. We further explain IAFs' non-involvement in ESG and demonstrate stakeholders' lack of awareness