Australia Consults on Climate Reporting Reforms

Australia’s government has issued a new consultation proposing draft legislation to introduce climate reporting updates. This paper builds on previous consultations held in December 2022 and June 2023, with the new exposure draft legislation seeking to amend parts of the Australian Securities and Investments Commission Act and Corporations Act. If approved, the proposed changes would introduce mandatory requirements for large businesses and financial institutions to disclose climate-related risks and opportunities. Under the new rules, they would need to file a sustainability report containing annual financial figures, in line with relevant sustainability standards issued by the Australian Accounting Standards Board (AASB). The report would also include a climate statement for the year and a directors’ declaration about compliance. The consultation on the exposure draft legislation will run until 9 February, and was accompanied by a policy statement outlining the government’s final policy design for corporate climate-related financial disclosure requirements. Australia has endorsed the full adoption of the International Sustainability Standards Board’s IFRS S2 Climate-related Disclosures standard, with modifications limited to those necessary to ensure that they are fit for purpose in the country. The ASSB holds responsibility for the final standards.

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