Whether you’re a major corporation or a small business, Australia’s mandatory climate-related financial disclosures will affect you. Recent updates to the Corporations Act 2001 require many companies to disclose their climate impacts and risks, and some businesses may be unaware that these rules impact them—directly or through their supply chain.
Starting January 2025, Australia’s largest emitters (Group 1, including the top 700 companies) must begin these disclosures. The reporting requirements will then expand in July 2026 and July 2027 to smaller Group 2 and Group 3 businesses, respectively. If your company files annual reports with ASIC and falls within the thresholds of these groups, you will need to comply.
As part of the annual reporting process, businesses will now submit a climate statement within a ‘sustainability report,’ alongside the traditional financial, directors’, and auditors’ reports. These climate statements must align with the new AASB S2 standard from the Australian Accounting Standards Board. While detailed reporting guidelines have yet to be released, ASIC has provided some more information. For some companies, the most challenging new requirements will involve assessing Scope 3 emissions (impacts across your supply chain) and evaluating climate risks under different global warming scenarios.
If you’re required to report climate-related financial disclosures, start preparing now. If you are a smaller companies you are likely to be asked for this information to continue working with larger clients.
What do you do next?
- Familiarize yourself with the new Australian climate reporting framework.
- Understand when these requirements apply to your business.
- Begin with a gap analysis and develop a roadmap for your own reporting.
The Ecoefficiency Group specialises in greenhouse gas inventories, reduction strategies, climate risk assessment, and adaptation planning. With over 20 years of experience across multiple industry sectors and government, we’re here to help you meet these new standards and pave the way for a sustainable future. Book a free call to discuss how the new regulations affect your business and start preparing now.