Australia has introduced mandatory climate disclosure for business that will become compulsory from the 1st of January 2025.
Passed by Parliament on 9th of September 2024 and received Royal Assent on 17th of September 2024, the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024 comes with the commitment of Australian’s government to prioritize sustainability. It will provide Australians and investors with clearer, more comparable information on entities’ climate risks, opportunities, and strategies by improving climate-related financial disclosures.
Initially targeting public and large companies with over 500 employees, revenues over $500 million or assets over $1 billion, as well as asset owners with more than $5 billion in assets (Group 1) it will then expand to companies with more than 250 employees, $200 million+ revenue, $500 million assets (Group 2). The reporting requirement for Group 2 will be July 2026. Smaller companies (Group 3) will also have to start reporting one year later.
What will need to be reported?
The sustainability report for a financial year will need to contain elements such as :
- the climate statements for the year:
- the entity’s material climate-related financial risks and opportunities;
- the entity’s metrics and targets for the financial year relating to climate that are required to be disclosed by the sustainability standards, including in relation to scope 1, 2 and 3 emissions of greenhouse gas; and
- any information about the entity’s governance, strategy, or risk management in relation to these risks, opportunities, metrics and targets
- any notes to the climate statements:
- any disclosures required by the Minister in relation to the preparation of, or anything included in, the climate statements;
- anything required by the sustainability standards; and
- any other information necessary to ensure that climate statements and notes together meet the content requirements set out in section 296D of the Corporations Act.
- the directors’ declaration about the statements and notes.
- A sustainability report must include a directors’ declaration which is a declaration by the directors of their opinion on whether the contents of the sustainability report are in accordance with the Corporations Act, including that the sustainability report complies with the sustainability standards (once made).
For more details, visit ASIC website :
When sustainability reports must be lodged?
According to ASIC website, reports will have to be lodged within 3 months after the end of the financial year for a disclosing entity, registered scheme or RSE or within four months after the end of the financial year for other entities.
Depending on when the financial year ends, it means 31st March 2026 or 30 April 2026 for entities whose financial year ends on 31st of December, and 30 September 2026 or 31st October 2026 for entities whose financial year ends on 30th of June.
