Mandatory Climate Reporting in Australia | New guide outlines the steps directors can (and should) take now to prepare

2 minute read (PDF download)  10.10.2023 Kate Hilder, Phoebe Roberts, Sarah Barker

How directors can prepare now for 'the biggest change to corporate reporting in a generation' 

It's currently proposed that mandatory climate reporting obligations, based on global standards, will be phased in for large Australian corporations and financial institutions, from July 2024.

For more on the proposed requirements see: Introduction of mandatory climate reporting in Australia: Second round of consultation launched

Ahead of this, through the Australian Chapter of the Climate Governance Initiative (CGI), the Australian Institute of Company Directors, MinterEllison and Deloitte have jointly released a new guide - A director’s guide to mandatory climate reporting - to assist directors to prepare for these landmark reforms.

In his foreword to the guide Australian Securities and Investments Commission (ASIC) Chair Joe Longo underlined the significance of the shift to mandatory reporting and the key role boards are expected to play in overseeing it. Mr Longo comments:

'This shift to mandatory climate-related disclosure presents the biggest change to corporate reporting in a generation….Getting started early is critical, as is a recognition that the quality and depth of reporting will mature over time. As stewards of long-term value, boards have a critical role to play in overseeing this shift to high-quality climate reporting, and building organisational resilience in the face of the escalating physical and transitional risks posed by climate change. I am therefore pleased to see that the Australian Institute of Company Directors, Deloitte and MinterEllison have partnered via the Climate Governance Initiative (CGI) Australia, to publish a Climate Reporting Guide aimed at preparing directors for this major reform. At its heart, good quality reporting must be underpinned by strong and effective governance. Boards must think about both the risks and opportunities facing their organisation, now and into the future. I encourage Australian directors and executives to show leadership at this critical juncture for our nation and economy'.

What's in the guide?

The guide aims to help directors understand the changes, why they are being introduced, how to assess their existing level of preparedness and identify what they (and their organisations) need to do to prepare.

Broadly, the guide includes:

  • An overview of the current reporting landscape
  • Discussion of how climate change fits into directors' duties under existing Australian laws
  • The practical steps directors can take now to help ensure their organisation and their boards are prepared for the introduction of mandatory climate reporting. Appendix A to the guide is a list of questions for directors to consider, as well as a list of practical steps.

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Director's guide to a mandatory climate reporting

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https://www.minterellison.com/articles/directors-guide-to-mandatory-climate-reporting-october-2023