Auditors as Idealists? Climate Change, EU Sustainability Regulation, and the Efficacy of Assurance
Authors:   , Norma Jørgensen Olivia 
Published: January 2025

This thesis is an ethnographic study of the moral dilemmas which sustainability professionals experience working with sustainability in a large audit firm. Drawing on data gathered from Summer 2021 through Summer 2024, the thesis offers an account of moral work in the everyday lives of professionals obtaining assurance and ensuring trust in reported information related to sustainability. The thesis offers an account that diverges from other ethnographic case studies of finance in that it relies on in-depth participant observation amongst sustainability professionals in the years that shaped not only the sustainability department but also the context in which they are operating. A new regulatory framework was adopted by the European Union during the time of fieldwork, which required much more collaboration between the sustainability and audit departments.
This collaboration led to tensions, as the sustainability professionals and the financial auditors had different understandings of what were the most important subject matters to discuss with clients and get changed in a company’s report, which throughout the thesis will be termed as different materiality thresholds. The two professions developed a common understanding of sustainability, leading to a new definition of what sustainability means in the context of assuring sustainability-related accounts. This new understanding not only built on their previously held, diverging understandings of sustainability but was also influenced by the requirements and standards the audit profession has to comply with, as well as the context of the capitalist market economy.
I explain how the sustainability professionals and financial auditors have different understandings of materiality thresholds, ultimately leading to different understandings of what is important. Drawing on the moral dilemmas in situations from the sustainability professionals’ everyday lives, I show how the sustainability professionals experienced hope and resentment, and how the vacillation between these two emotions led them to doubt the frames of which they were a part—in this case, those of the powerful audit firm. The sustainability professionals’ doubts never led to their leaving these frames. The few sustainability professionals who did leave PwC ended up joining other powerful organisations, such as competing audit or consulting firms or large listed Danish companies. Their doubt, however, settled as a newfound hope in what the future has in store: that with the implementation of the EU’s sustainability regulations, Danish companies would change their practices to become more sustainable.
I ultimately suggest that the understanding that implementing sustainability into finance, regulatory frameworks and audit standards would lead companies towards more sustainable behaviour not only led to moral dilemmas in the sustainability professionals’ day-to-day lives but also created a particular kind of morality that shaped the shared context that the sustainability professionals, financial auditors, and Danish companies navigated. This new understanding of sustainability within finance, created through the lens of these moral tensions, has shaped the business landscape of Danish companies’ work with sustainability and beyond.