Climate Sustainability Reporting

Written by Daniel Dalla | 18 February 2025

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:

A company and its controlled entities exceeding 2 of the 3 criteria
First Annual Reporting Period on or After	Consolidated Revenue	Consolidated Gross Assets	Full Time Equivalent Employees
1 January 2025 (Group 1)	$500 million	$1 billion	500
1 July 2026 (Group 2)	$200 million	$500 million	250
1 July 2027 (Group 3)	$50 million	$25 million	100

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:

	First year	Second year	Third year	Fourth year
Sustainability Disclosures	30 June 2028	30 June 2029	30 June 2030	30 June 2031 onwards
Governance	Limited	Limited	Limited	Reasonable
Strategy - Risks & opportunities	Limited	Limited	Limited	Reasonable
Climate resilience/scenario analysis	None	Limited	Limited	Reasonable
Transition plans	None	Limited	Limited	Reasonable
Risk management	None	Limited	Limited	Reasonable
Scope 1 and Scope 2 emissions	Limited	Reasonable	Reasonable	Reasonable
Scope 3 emissions	N/A (transition exemption defers disclosure to second year)	Limited	Limited	Reasonable
Climate-related metrics and targets	None	Limited	Limited	Reasonable

Climate Sustainability Reporting

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