View from the Institute – Change: develop and adapt

I recently attended the IIA International Conference and Global Assembly, the latter of which brings together CEOs and Presidents from Institutes of Internal Auditors around the world. Much of the conversation focused on the need for change. Some of this was general – discussions about the future of internal audit and evolving issues such as the profession’s response to, and use of, developments in artificial intelligence (AI). Other discussions were more specific – for example, around work on updating the professional Standards and the forthcoming evolution of the CIA certification.

The Chartered IIA is closely involved in these global discussions and we are well represented at the highest level. Peter Elam, our President, and Liz Sandwith, our Professional Practices Adviser, both sit on the Standards Board and are working to shape the way the profession develops to enable all our members to rise to the many challenges ahead.

In the UK and Ireland, organisations are facing a multitude of changes at every level. The EU has introduced mandatory reporting on environmental, social and governance (ESG) performance, while the UK is formalising requirements for public interest entities to explain how they acquire assurance over non-financial statements – as recommended in the, then named, BEIS response to the White Paper on Restoring Trust in Audit and Corporate Governance.

This is something that the Chartered IIA has been advocating for some time (since it implies a need for internal audit) and we will be monitoring and aiming to influence the way legislation develops.

Meanwhile, the UK government is also progressing changes to strengthen the Corporate Governance Code and many organisations are grappling with evolving sector-specific rules, such as the new consumer duty obligations for financial services firms and requirements for manufacturers to make eco-labelling consistent and rigorous.

More widely, the global environment is changing rapidly – and, often, unpredictably. Our most recent report highlights chief audit executives’(CAEs’) renewed focus on financial risks because of volatility created by interest rate hikes, threats to supply chains and soaring inflation. Much of this is underpinned by geopolitical uncertainties, highlighted in our previous report “Navigating Geopolitical Risk”. Developments in AI and alarming indications of climate change across the world this summer add further concerns to the tottering pile on CAEs’ desks.

However, change is a two-edged sword and there are many opportunities if we can, and dare to, seize them. This month sees the publication of our annual Risk in Focus research, which will identify what CAEs across Europe see as priorities for 2024. This tells us what we are all likely to be focusing on in the coming months, but it also highlights areas where organisations will most need internal audit skills.

At times of rapidly emerging risks, organisations need assurance, a critical view of their own exposure and advice on best practice more than ever. If internal audit does not provide this, they will look elsewhere.

The Institute will, as ever, be looking to support its members so you can capitalise on these opportunities. Success cuts both ways – if you do well, we do well and the more people who understand and appreciate our profession, the easier it will be to attract the best talent to join us. This is where internal audit communities such as Aspire, Women in Internal Audit and our new Race and Ethnicity Group are so valuable. We need to inspire potential internal auditors and encourage university graduates and those looking for a new challenge to join us.

We will continue to research and publish technical guidance and reports to help members tackle new and unfamiliar areas of risk as they emerge, and to provide training and forums so members can learn and share their stories. We want to help you use the connections the Institute can provide and to learn from each other – whether this is via events such as our Annual Conference in October or regional gatherings. 

And we need to share and publicise best practice so everyone can develop further. This is why our Audit & Risk Awards are so important. Nominations for the 2024 awards open in October, so tell us what you have been doing and how you are developing what you offer. This not only rewards you and your team, but also helps us to publicise the work that our members do more widely, benefiting the whole profession.

This year’s Annual Conference will coincide with the AGM and the approval of our new President, so please join us there, or get involved with the groups and networks that the Institute provides. Many hands make light work – and many minds will shed light on many opportunities.

This article was published in September 2023.