Climate Sustainability Reporting

Legislation to mandate sustainability reporting received Royal Assent on 17 September 2024 in relation to the introduction of standardised internationally aligned reporting requirements in relation to climate sustainability reporting.

The applicable standards are:

• AASB S1 – General Requirements for Disclosure of Sustainability-related Financial Information; and
• AASB S2 – Climate-related Disclosures.

These standards require disclosures (both qualitative and quantitative) in relation to:

• Governance – the governance processes, controls and procedures the entity uses to monitor and manage sustainability-related risks and opportunities;
• Strategy – the approach for addressing sustainability-related risks and opportunities that could affect the entity’s business model and strategy over the short, medium and long term;
• Risk Management – the processes the entity used to identify, assess and manage sustainability-related risks; and
• Metrics and Targets – information used to assess, manage and monitor the entity’s performance in relation to sustainability-related risks and opportunities over time.

The above information will need to be disclosed in a company’s financial report and this information be subjected to audit or review.

The timing and scope of which company’s are required to prepare sustainability reports are summarised in the below table:

National Greenhouse and Energy Reporting reporters and Registerable  Superannuation  Entities, Registered Schemes and  Retail CCIVs with assets over $5 billion will also be required to report in accordance with these standards.

The following table compares when various aspects of sustainability reporting are subject to assurance, and when for a Group 3 company with a 30 June year end:

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