The concept of sustainability is becoming increasingly important for companies and organisations to fulfil their economic, environmental and social responsibilities. The Regulation on Sustainability Audit (‘Regulation’), which entered into force after being published in the Official Gazette dated 17 January 2025 and 32735, aims to strengthen the principle of transparency and accountability by determining the procedures and principles of audits in this field.
The main purpose of the Regulation is to determine how sustainability audits will be conducted within the framework of the Turkish Commercial Code No. 6102 and the Decree Law No. 660 on Public Oversight, Accounting and Auditing Standards Authority. In this context, the Regulation addresses the procedures regarding the authorisation of independent audit firms and independent auditors, keeping their registry records, audit obligations, responsibilities and audit process.
The Regulation requires the following conditions for audit institutions authorised to conduct sustainability audits:
- Being a registered and active independent audit organisation in the Independent Audit Official Registry,
- Having at least two responsible auditors,
- The existence of an audit staff that meets the minimum requirements in terms of quality and breadth,
- Establish sustainability audit guidelines.
Persons who wish to be authorised as a sustainability auditor must meet the following conditions:
- Being an active independent auditor registered in the Independent Auditor Official Registry,
- To be successful in the exam subjects related to the field of sustainability,
- Have completed the necessary practical training.
Auditors and audit firms that meet the above-mentioned requirements and are authorised will be registered in an official public register.
The teams that will perform the sustainability audit will consist of a sufficient number of auditors, taking into account the size of the audited entity, its activities and the nature of the regulations to which it is subject. However, this number shall not be less than three auditors including the responsible auditor. At the same time, the number of backup auditors shall be determined as the number of auditors in the audit team. As a result of the audit, a sustainability audit report, in which the audit evidence is evaluated within the framework of Turkish Auditing Standards and which bears the signatures of the auditor and the audit firm, shall be prepared. This report shall be delivered to the management body of the audited entity at least 20 days before the ordinary general assembly meeting for the accounting period to which the audited financial statements relate, and in any case until the end of the maximum period stipulated in the Turkish Commercial Code for ordinary general assembly meetings.
The audit activities carried out by the audit institutions will be examined and audited by the Public Oversight, Accounting and Auditing Standards Authority, and the Authority will include its findings in its annual report. In this context, if any irregularities are detected by the Authority, sanctions such as warnings and cautions, restriction of activities, suspension of operating licences, cancellation of operating licences and administrative fines may be imposed on audit institutions and their auditors. As a matter of fact, audit institutions and auditors will be individually liable for the damages that may arise in the event that sustainability audit reports are prepared in violation of Turkish Auditing Standards or the information and assessments in the reports are incomplete, misleading or inaccurate.
In conclusion, the Sustainability Audit Regulation is a critical regulation that aims to increase the transparency of companies and financial markets. Its proper implementation will contribute to companies' long-term sustainability strategies and make audit processes more reliable.
You can access the full text of the Regulation via this link.