Richard Spencer, ICAEW’s Director of Sustainability, cites a recent survey of public opinions and social trends, where people were asked to name the most important issues facing society. After the cost of living, the NHS and the economy, climate change was the most commonly reported concern.
It’s particularly true for younger generations. “Students training as chartered accountants don’t need to be persuaded about the importance of sustainability,” adds Adam Birt, Head of Qualifications, Strategy and Development at ICAEW. “It is part and parcel of their lives and of their views on the world.”
Future-proofing the ACA
As sustainability gains prominence as a global issue, so too does its presence and profile in the ACA qualification. It’s Adam’s responsibility to update the ACA syllabus to ensure the qualification remains current and relevant. One particular challenge with integrating sustainability into student training is ensuring consistency of language. A glossary is included as part of the learning materials provided by ICAEW to students, which includes terminology around what we mean when we talk about sustainability.
As Adam explains, “We’re not just talking about climate change; it’s social, economic and environmental. A lot of jargon has crept in recently throughout the business world, so language is crucial.”
With new content being added all the time, it is important to ensure the ACA syllabus remains manageable. Part of this is ensuring the focus is on what’s relevant and not replicating information. “We have also focused on ensuring coherence of approach from Certificate through to Advanced Level. The result is that the student's depth of knowledge increases as they progress through the qualification.”
It was a conscious decision to embed the subject matter throughout the syllabus, rather than creating a separate module or learning programme. “We have a track record of doing this,” he adds. “We embedded ethics across the qualification 15 years ago, and since 2016 have enhanced embedding content on technology. Our approach to embedding sustainability ensures the content is appropriate within the context of the subject matter of each module."
With most students training with ICAEW for only three or four years, we are developing relevant professional skills and introducing appropriate knowledge in that timeframe. Key areas such as sustainability must be prioritised and signposted, but at the same time, it’s about striking a balance. Richard explains:
We’re not training people to be sustainability experts, and it would be very easy to fall into that. We want our members to be competent. They could choose to go on and become experts in human rights or modern slavery or biodiversity, but that’s not what we’re doing. And so there is a balance to be found.
There has been a significant change over the past 20 years in the way that we assess, because it’s not just about knowledge – it’s not an academic set of exams where you learn stuff by rote and reproduce it. Students will be presented with a problem for business based around a sustainability issue, and it’s all about utilising those skills that are core to the chartered accountant’s toolkit with the knowledge of this new area. As a result our examiners also need to be upskilled so that new skills and knowledge can be properly assessed.
Improving decision-making
“The climate crisis, biodiversity crisis and the human crisis of inequalities are the determining issues of the day,” says Richard. “They affect our everyday lives as well as our business lives. They have the potential to cause, and have already caused, not just human tragedy but massive economic damage and the loss of business value. However, mitigating and adapting to these crises will offer huge opportunities. One thing we just cannot do is ignore these problems.”
For the accountancy profession, in particular, it is about the flow of information through the system, In an economic system, data and information are what help people make decisions. How do you know what risks you face unless you can quantify in some way the impact of climate change over the next few years on us and on our businesses? Without somebody being able to quantify that or put it into qualitative, valuable information that can be trusted, businesses can’t make decisions.
By the end of their ACA qualification, students will be equipped with the knowledge and skills to factor sustainability into their work in this way – particularly as the world becomes an increasingly uncertain place. “If you’re now looking at a much broader range of impacts and risks, then you’re going to start making different decisions,” concludes Richard. “Accountants tend to be increasingly thinking less about the risks they face and more about the uncertainty they face. And in that space, it becomes much more about resilience than about risk. It changes the nature of how you think about things.”