Global energy and commodity news and price reporting agency Argus has completed its fourth external assurance review of its energy price benchmarks and extended the scope of the process to cover petrochemicals and fertilizers for the first time.
The assurance review was conducted by independent professional services provider PwC and examined the policies and processes that Argus uses to establish price benchmarks for oil, thermal coal, coking coal, natural gas, biomass, fertilizer and petrochemicals. These processes are designed to ensure compliance with the principles for price reporting agencies (PRAs) set out by the International Organization of Securities Commissions (the Iosco PRA Principles). A “reasonable assurance” review was carried out for energy benchmarks — oil, thermal coal, coking coal, natural gas and biomass — as recommended by Iosco.
Argus Media executive chairman and publisher Adrian Binks said: “We are pleased to have completed successfully our fourth assurance review for Argus’ energy benchmarks and are glad that we have extended the scope to include fertilizer and petrochemical benchmarks, which are a growing part of our business. We found the PRA Principles entirely appropriate for application to our other commodity benchmarks.”
Argus successfully completed the first independent review of oil benchmarks in October 2013 and was the first PRA to extend the Iosco PRA Principles to non-oil energy benchmarks, in January 2014.
Iosco announced the results of its second annual review of the implementation of the PRA Principles last month. Iosco and the other organisations involved in the process have now decided that they do not need to carry out these annual reviews in future. Iosco said: “Given the progress that has been evidenced to date, the commitment by the four main PRAs to continue adhering to the PRA Principles, and to undergo independent external assurance reviews, Iosco, the IEA, IEF and Opec do not believe that further annual implementation reviews will be necessary at this time.”
Commenting on the publication of Iosco’s implementation report last month, Adrian Binks said: “I am pleased to see yet another positive review from Iosco of the implementation of the PRA Principles. Argus’ extensive compliance with these principles forms part of our long-standing commitment to identifying and adopting best practice in commodity price reporting across our business. I would urge EU legislators and policy makers to note Iosco’s second implementation report and to ensure that their negotiations on the EU’s proposed benchmark regulation lead to legislation that fully aligns with the Iosco PRA Principles with respect to PRA commodity benchmarks.”
The Iosco PRA Principles were published in October 2012 and endorsed by the G20 in November 2012. They cover governance, control, quality, integrity and conflict management in relation to commodity benchmark price assessments published by PRAs and require an annual external audit.