The International Sustainability Standards Board published the first two IFRS® Sustainability Disclosure Standards (IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures) on 26 June 2023. These standards are effective from 1 January 2024 – however, will not be mandatory unless regulated by jurisdictions.

Second Treasury consultation

Coinciding with this major milestone in sustainability reporting – and with an option for organisations to adopt a ‘climate-first’ approach – the Australian Treasury released its second consultation paper on climate-related financial disclosure. This Treasury consultation builds on the previous discovery consultation in December 2022 and proposes more definitive positions to facilitate standardised reporting requirements that align with international standards.

The consultation seeks feedback on proposed positions for:

  • Reporting entities – phased implementation depending on size
  • Assurance requirements – phased moving from limited to reasonable assurance
  • Reporting framework – location, frequency and timing of disclosures
  • Liability and enforcement – modified liability approach to forward-looking statements
  • Reporting content – which is broadly consistent with IFRS S1 and IFRS S2.

We expect climate-related financial disclosures to apply in Australia as soon as 30 June 2025 for some entities.

Further details are set out in our Reporting Update.

Submissions on the Treasury consultation are due 21 July 2023

Sustainability standards in Australia

The Australian Accounting Standards Board (AASB) will continue with its climate-related financial disclosure project to release a standard based on IFRS S2

In its most recent meeting, the AASB decided to expand the scope of its project, previously limited to the for-profit sector, to explore the development of sector-neutral Australian climate-related financial disclosure requirements.

We expect an Australian standard to be published to meet the government’s timeline.

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