How to Pass SASB FSA Level 1: What to Expect and Study Tips
If you are reading this article, you might be thinking of registering for the SASB FSA Level I test. I recently passed Level 2, so I’m officially an FSA credential holder!
I was surprised to find that there are not a lot of resources out there to help prepare for level I or II of the FSA. When you sign up for each test, you will receive a 300-page study guide. You will also have the option to enroll in a verified third-party course, like Earth Academy. However, unlike the SAT or ACT, there is just not a lot of information out there about how to prepare. I will help put your mind at ease and give you a study structure to follow as well as a bit of info about the credential!
I am an Outsider to CSR, but I Passed the Test
I am not a sustainability professional (yet!). It was all the more challenging to pass this test while not actively working in the field. If you already work in corporate social responsibility or manage your company’s sustainability reporting, congrats! You have a huge leg up as you start your study journey.
If you have any familiarity with the private and public financial markets, this will also accelerate your study process. (Grateful to have worked for a financial data provider for 3 years- it definitely helped!)
However, do not worry if you are new to finance and sustainability. You will be ok! Just be aware of your knowledge gaps and bake that into your study schedule. For example, if you are unfamiliar with the financial markets, budget 2–3 weeks of extra study time to look up and learn about concepts that come up in the study guide. Such as, “limited partners”, “portfolio companies”, etc.
So Many Acronyms!
The IFRS Foundation is a “not-for-profit, public interest organization established to develop high-quality, understandable, enforceable and globally accepted accounting and sustainability disclosure standards”. The foundation is in charge of the SASB standards and issues the credential.
The IFRS established the ISSB (International Sustainability Standards Board). The IFRS and ISSB are in charge of setting the SASB standards. The IFRS issues the FSA credential, which is awarded after passing levels I and II. The FSA tests knowledge of the SASB standards, which are managed by IFRS and ISSB.
TLDR: SASB is the reporting framework, FSA is the credential, and IFRS/ ISSB set the reporting standards. When you complete levels I and II, you become an FSA Credential Holder and you are able to report on sustainability using the SASB standards.
Who Should Take This Test?
It depends on what you want to do in sustainability. If you want to have any involvement in reporting on business materiality and externality, such as carbon emissions and human rights in the supply chain, you will likely need to know the SASB reporting framework. The SASB website has a library of companies that report using the framework, so you can see the variety of formats and narratives. There are a variety of business functions that touch the reporting process, such as PR, communications, marketing, and operations.
If you want to work for a sustainability consulting firm or at an investment bank, knowledge of this reporting framework will definitely be useful. For example, you might work for a consulting firm that specializes in working with the retail sector. You can then use this reporting framework to help businesses report on their supply chains and discuss the externalities of their business operations.
I signed up for the FSA because I would like to work in the field of corporate social responsibility. After learning about the field a couple of years ago, I started to do research and set up tons of networking calls. In speaking with 30–40 sustainability professionals, SASB and the FSA credential stood out as a key skill set. GRI and TCFD are two other leading reporting frameworks that are used by corporate social responsibility teams.
3rd-Party Learning Options
Before you enroll through the SASB website, make sure to take a look at the certified 3rd party learning options. If you enroll with a learning provider, this may impact how you schedule your test. These are the learning provider options listed on the SASB website:
On-Demand:
To enroll with Marquette University, you have to submit a questionnaire. I did not try this so I’m not sure what the experience entails.
I enrolled with Earth Academy for FSA Level II. They offer online modules that are self-paced. If Level I is anything like Level II, the content is pretty dry and the flow of content is kind of confusing. However it’s way more convenient than submitting a form or attending a live class, so I would still recommend it.
Attend Live Classes:
ISOS offers classes over Zoom, so it can still be completed from home.
Similar to Marquette University, you will need to request information to enroll in this test prep course.
Scheduling the Test
If you sign up directly through the SASB website, you will have to choose a test date before receiving the study guide. The IFRS has three testing blocks: January-February, May-June, and September- October.
If you sign up with Earth Academy, you will be provided with a signup code. You can then start to review the study materials before choosing a test date and have more flexibility on the specific date. I chose this option for level II and found it to be a much better experience.
You can take the test in person or online, proctored by Pearson VUE. I chose the online option and completed the test from my home office. Upon registering for the test through the SASB website, you will receive an email with the subject “Confirmation of Pearson VUE Exam Appointment”. The email will include a link to the study guide and a code that you can put in to download the PDF.
The Study Guide…
The study guide is… dense. If you went to law school or have a job that requires reading a lot of corporate language, you will not be alarmed by the content. It’s not terrible, but let’s just say it’s not a relaxing poolside read! It’s very long-winded and wordy, like Uncle Colm in Derry Girls.
The current study guide is split into three sections and has eleven chapters. Section 1 focuses on the need for sustainability accounting standards, Section 2 focuses on the SASB standards, and Section 3 reviews how to use the SASB standards.
Each chapter outlines learning objectives, such as: “IDENTIFY the factors influencing investor use of sustainability information” and “RECOGNIZE the role of sustainability management in corporate strategy and risk management”. Vocabulary words are bolded, and there’s a glossary of key terms at the end of the study guide.
Create a Study Schedule
The IFRS recommends studying at least 30 hours before the exam. I probably studied about 45 hours, just to be safe. If you are unfamiliar with the financial markets and sustainability, add 15–20 hours to your study time. If you are only familiar with the financial markets but not sustainability, 45 hours should be about right. If you work in sustainability and have a strong grasp of the financial markets, 30 hours should suffice.
This is a rough outline of the schedule that I used to pass Level I:
12 weeks before the test:
15 hours listening to the study guide with Natural Reader (see next section).
8 weeks before the test:
10 hours reading the study guide and making notes of key concepts.
5 hours listening to the study guide with Natural Reader (see next section).
4 weeks before the test:
10 hours re-reading the study guide to create flashcards.
1 hour of testing myself with flashcards.
1 week before the test:
1 hour of testing myself with sample questions.
2 hours of testing myself with flashcards.
2 hours listening to the study guide with Natural Reader (see next section).
24 hours before the test:
Fall asleep to the beautiful lullaby of the SASB FSA Level I Study guide.
No matter what format you choose, it’s important to space out your studying so that it fits in with your life and does not feel like too much extra work. Think about how much time you have until the test, and then schedule a few hours each week to build knowledge up until that test date. I’m not saying this will alleviate all stress, but it helps to have a plan and stick to it.
Listen to the Study Guide
Do you like audiobooks? I have the attention span of a squirrel when I am actively reading text, but audio learning works wonders. For this reason, I recommend using a program like NaturalReader to listen to the study guide. NaturalReader is a website and mobile app that allows you to upload and listen to documents.
Here’s how it works: create an account or sign in with Google. After that, upload the PDF. I like to listen at 1.25X or 1.50 speed. You can pause, rewind, and relisten if something does not make sense.
I highly recommend this study method for keeping FSA top of mind while doing other activities. I listened to the study guide while cooking, sitting out in the backyard, driving, etc. It’s also great when you have been working all day and cannot imagine starting at a screen for a moment longer.
Read the Study Guide
You are likely thinking “Yes Meredith, of course, I am going to read the study guide!”. I know you will, but hear me out! The study guide, as previously stated, is very dense. Sometimes it feels like reading a dictionary. With that in mind, I think you have to have a timeboxed method of reading this study guide.
For example, Chapter 3 of the study guide is about 10 pages long. Try to read the chapter in one sitting. Then go back through for a second read and highlight or take note of key concepts or examples. On the third read-through, write down the key concepts and examples on flashcards.
You might be able to read, note the key concepts, and add the information to flashcards in one sitting. If so, you are a rockstar, and I applaud you! If your brain works like mine, I find it easier to focus on one objective at a time. I would compare it to chefs cutting up all of the vegetables before starting to cook the recipe. It’s a lot easier to create flashcards when you’ve established a baseline understanding of the material.
Strategic Use of Sample Questions & Questions at the End of Each Chapter
In the study guide at the end of each chapter you will find reflective questions. Such as, “why was disclosure the basis of regulatory reform in the wake of the 1930’s stock market crash?” and “what is the relevance of “materiality” in the context of disclosure, and how has the concept historically been interpreted?”.
Sample questions can be found on the website and at the end of the study guide. These are multiple choice questions, such as “What is the primary challenge that the disclosure of company policies (such as ESG policies or whistleblower policies) can pose to investment analysis?”.
I chose to save these questions and test myself the last couple of weeks before the test. This worked for me and helped me identify last-minute knowledge gaps! However, you might also find it valuable to study these questions after several read-throughs of the study guide. Whatever you choose to do, make sure you cherish each question. The IFRS does not provide a lot of practice questions!
Flashcards
Flashcards! You will find these very helpful in preparing for Level I, and only mildly effective in preparing for Level II. I would absolutely recommend that you create flashcards early on in your study process and review these cards every week leading up to the test.
For Level I, I took the questions listed at the end of each chapter (about 3 questions per chapter) and wrote those down on notecards. I also wrote down vocabulary words and examples from the study guide, as well as the sample questions from the website. It takes a long time to write out the flashcards, but it is worth the hassle! Try to study a few at a time, then go back and review each set before moving on to the next set. That way you reinforce the information at each step.
You can also take advantage of flashcards created by other students on Quizlet. I personally did not use these flashcards because I wanted to use my own words and language to review the concepts. But you might find these perfectly useful!
Study in Different Locations
I find it helpful to review material in different locations, either around your city or in your home. According to “Absolutely Studying”, “regularly switching up your study location creates links from the information under study directly to the atmosphere in which it was absorbed”.
In the 48 hours before the Level I test, I created 12 unique study locations throughout my house. The couch, the backyard, the office, the driveway, etc. In each location, I placed a stack of flashcards and chose a music genre to play, like jazz. (Ok I know I’m weird! But it worked!) Then I set a timer and spent 1 hour in each location, studying and reviewing flashcards. I was then able to associate the locations with the concepts while taking the test.
To prepare for Level II, I ventured out of my home and studied in several locations. A coffee shop, a waterfront park, even sitting in my car! I made sure to not review all of the material in one place but to focus on one section per location. I have no scientific evidence for the effectiveness of this strategy, but I find it helpful to associate different visuals with each chunk of information.
Getting Ready for Test Day
Make sure to download the Pearson Vue app if you are taking the test virtually. You will need to have reliable internet and a quiet testing space with no distractions. Make sure you have your desk cleared and a government-issued ID ready to scan. You’ll also need to have your phone nearby to complete some of the sign-in steps, and the proctor will ask you to move it to an inaccessible part of the room once the testing starts.
I’m not sure if this is necessary, but I cleared nearly everything out of my office. Books, notes, etc. There is a proctor that reviews your study area live on camera, so you’ll need to make sure that all study materials or anything that looks like study materials are out of the room! You also need to make sure that all external monitors are unplugged from your primary computer and close all computer windows other than the Pearson VUE app.
The test is 2 hours long and consists of 110 multiple-choice questions. You will NOT have to answer any open-ended questions or perform calculations on this test. (However, you will have to do some calculations on Level II!)
Results
You’ll likely be relieved to find out that results will be issued nearly instantly through Credly. Because it’s multiple choice, the system scores your test and will send you an email letting you know the results. If you passed the test, the email will actually come from Credly and will say “Congrats! You just earned a badge from IFRS Foundation!”.
You will not get a specific score report showing right/ wrong answers, just this mysterious email and a link to see your badge. You will then have the option to join an FSA Credential LinkedIn group so that you can network with other Level II candidates and those that have completed the credential. Don’t forget to sign up for Level II soon within 2 years of passing Level I or you will lose progress and have to start over!
I hope you found this article useful as you learn about the FSA credential! Good luck with your test, and leave a comment if you have any further questions about how to prepare!
What CSR topic would you like me to research next? Leave a comment with your ideas!
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