mandatory climate reporting
The reporting landscape is changing. Are you ready?
The reporting landscape is changing. Are you ready?
Australia is introducing major legislative changes in the way large organisations are required to report on climate-related risks and opportunities.
We see this as an opportunity on several fronts.
A new standard in climate reporting
Australia now has legislation in place that requires larger companies to report on the risks and opportunities associated with climate change. The Australian Accounting Standards Board has released the standard AASB S2 Climate-Related Disclosures, which requires an entity to disclose information about climate-related risks and opportunities that could reasonably be expected to affect the entity’s cash flows, its access to finance or cost of capital over the short, medium or long term.
The Australian Sustainability Reporting Standard AASB S2 is aligned with international IFRS S2 principles, and builds upon the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), incorporating its four core pillars. AASB S2 provides a structured and legally enforceable framework for the disclosure of climate-related risks and opportunities. This standard has been designed to increase transparency, comparability, and consistency in the way businesses report on climate-related matters.
Mandatory climate reporting is likely to affect all Australian companies soon
Australia’s largest companies are already required to report in compliance with AASB S2, and there is a rollout schedule, as shown below, where companies become eligible if they satisfy 2 of the 3 criteria:
Group
Employees
Consolidated revenue
Consolidated Gross Assets
Effective Financial Year
Group 1
Over 500
$500m
$1b
1 Jan 2025
Group 2
Over 250
$200m
$500m
1 July 2026
Group 3
Over 100
$50m
$25m
1 July 2027
Regardless of your size, if your organisation supplies the larger entities listed above, you will be required to provide climate-related information to them. Typically, this will be data on your carbon emissions and your net zero strategy, but could extend to other sustainability topics, like your compliance with the Modern Slavery Act. The key take-away here is that if you’re not currently reporting on sustainability topics, you should be. Reach out today to see how Cool Planet can help you work with Group 1, Group 2 and Group 3 companies to align on sustainability and retain those valuable contracts.
AASB S2 requires companies to disclose information about climate-related risks and opportunities that could reasonably affect their financial performance, position, or cash flows
The standard requires disclosures related to the governance processes, controls, and procedures used to monitor, manage, and oversee climate-related risks and opportunities within the organisation
Compliant reporting must include information about the organisation's strategy for managing climate-related risks and opportunities, including how it plans for climate resilience and detailed scenario analyses.
Organisations are required to provide information on its processes for identifying, assessing, prioritising, and monitoring climate-related risks and opportunities.
Information is required on organisational drivers of climate change, including greenhouse gas emissions. Climate-related targets are expected, and progress towards those targets must be reported, including information about Scope 1, Scope 2 and Scope 3 greenhouse gas emissions.
How we work
CoolPlanet can help you prepare for compliance under AASB S2 (or voluntary reporting to AASB S1). Each client is different, but we have a clear and structured methodology for AASB readiness, based on best practice methodologies, an integrative approach to frameworks and standards, and years of experience in the field.
Our process is designed to address the specifics of your business, such as your unique stakeholder groups, your strategic priorities and your commercial realities. We consider the requirements of compliant reporting to the AASB S2 standard, as well as any broader frameworks, such as GRI, the UN SDGs or the Australian Government’s Climate Active certification for net zero.
We will then produce a bespoke and highly commerical roadmap for your business. Outcomes-focused and actionable, our roadmaps are led by science and deliver real-world impacts that you can be proud of (and afford).
Cool Planet has been a trusted partner on our sustainability journey for over 15 years. Their expertise and guidance have been crucial in maintaining carbon neutrality and achieving significant milestones, including becoming Australia’s first net zero plastics factory. Their support in carbon management and sustainability has been invaluable to our success.
Need to know more?
If you have a business problem and need an environmental lens, or you have an environmental issue, needing a commercial lens, we'd love to hear from you.
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