ASRS – Mandatory Reporting
The ESG measurement and reporting landscape is changing rapidly, in response to government
legislation and consumer demand. Is your organisation prepared for the new mandatory
requirements, especially in relation to Climate-related disclosures and Scope 3 reporting? *
In Australia, legislation has passed (September 2024) that requires large entities to submit a
sustainability report (alongside annual reports) containing climate statements that comply with
the sustainability standards prescribed by the Australian Accounting Standards Board (AASB),
commencing either January or July 2025 (depending on whether your reporting follows a
calendar or financial year), to be phased in over 3 years. AASB S2 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.
WHO?
Entities that are required to report under Chapter 2M of the Corporations Act (generally large
publicly listed companies that are required to make annual financial reports to ASIC), and meet
two of the three criteria:
| Commencing: | Meet 2 of 3 criteria to determine group: | |||
| Group 1 | January or July 2025 | $500M+ revenue | $1B+ gross assets | 500+ employees |
| Group 2 | July 2026 | $200M+ revenue | $500M+ gross assets | 250+ employees |
| Group 3 | July 2027 | $50M+ revenue | $25M+ gross assets | 100+ employees |
PLUS: NGER reporters, and Asset owners, who meet the relevant thresholds.
Small organisations may not have direct reporting obligations under the legislation, but if you
supply goods or services to large businesses (e.g., supermarkets or manufacturers), they form
part of the Scope 3 (supply/value chain) emissions of that reporting entity, and you will be asked
to provide data on your emissions and climate-related activities, so that it can be included by the
reporting entity. Scope 3 emissions reporting is required from the second year of the entity’s
reporting.
Confused? Start by establishing whether your organisation is required to make mandatory
reports under the proposed framework, then establish systems to collect the relevant data. If
you are a small organisation that may be swept up in the Scope 3 reporting requirements, start
doing your homework now, and access help to develop systems and train your staff.
WHAT?
The Australian Accounting Standards Board (AASB) is currently developing the Australian
climate disclosure standards. It is expected the sustainability reporting standards will include:
• the climate statements for the year;
• any notes to the climate statements; and
• the directors’ declaration about the statements and notes.
The climate statements and notes must disclose:
• 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.
ASIC is expected to release further guidance as it becomes available.
Help is available! I offer training and support for small or large organisations to help them meet reporting
obligations and sustainability targets. Please email fleur@realearthsolutions.com for more details.