Australia would include heavy greenhouse gas emitters, as well ASX 200 companies, in the first phase of a mandatory climate reporting regime, KPMG proposes in a submission to the federal government.

KPMG agrees with the government’s proposal that mandatory climate reporting should start in 2024 and suggests a phased approach to implementation, with some cohorts being given until 2028 to allow for capacity building and preparation. But in the initial phase, KPMG proposes that the scope is widened to include those entities which have facilities covered by the Safeguard Mechanism such as power stations and are required to report under National Greenhouse and Energy Reporting (NGERS) – plus those businesses providing critical infrastructure that are exposed to physical climate risks.

The government’s proposals – detailed in a consultation document, which KPMG is responding to – coincide with a global drive for consistent climate reporting led by the International Sustainability Standard Board. (ISSB)

Julia Bilyanska, KPMG Partner said: ‘Many countries are proposing that the new requirements are aimed largely at the top listed companies and large financial institutions, but we believe that doesn’t go far enough to capture a lot of Australia’s emissions (especially scope 3 emissions, which occur in companies supply chains). But we recognise there has to be a balance between covering sufficient emissions and allowing for capacity building and appropriate preparation time.”

KPMG’s own analysis shows that Australia’s top companies are already providing quality sustainability reporting to stakeholders and investors, which shows how business has taken the lead in recent years, in the absence of policy directives. The firm says that ISSB standards should be the baseline for Australian sustainability standards to ensure international consistency.

KPMG also propose that Indigenous Australians should be specifically sought and considered during the implementation of the climate standard here.

Julia Bilyanska said: “While we don’t believe in including additional Australian-specific climate requirements in our standards – as the more additions or carve-outs there are by countries the less global consistency there will be – we do note that there is no specific consideration of Indigenous Australians in the international standards. Given the importance of climate outcomes to Indigenous people we propose that the views of First Nations Australians should be sought and considered during the implementation of the standard here in Australia.“ 

Ian Welch
KPMG Communications
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