Australia legislates mandatory climate reporting, starting with the largest companies in 2025

The Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024 passed the Australian Parliament on 9 September 2024 and received Royal Assent on 17 September 2024. It adds mandatory climate-related financial disclosure to the Corporations Act.

What changed

• Entities that must prepare annual financial reports under Chapter 2M and that meet the size tests must also prepare an annual sustainability report, alongside the financial, directors' and auditor's reports.
• The sustainability report contains a climate statement prepared under the Australian Accounting Standards Board's standard AASB S2, Climate-related Disclosures, based on IFRS S2.
• It is phased in. A company falls into a group by meeting at least two of three size tests:
• Group 1: financial years from 1 January 2025. Revenue of A$500 million or more, gross assets of A$1 billion or more, or 500 or more employees.
• Group 2: financial years from 1 July 2026. A$200 million, A$500 million, or 250 employees. Large asset owners and NGER reporters are also brought in.
• Group 3: financial years from 1 July 2027. A$50 million, A$25 million, or 100 employees.

Who is affected

Large Australian companies and groups, their boards (which must sign off the sustainability report) and their auditors.

What to do

ASIC urged all groups, not just Group 1, to start preparing: governance, scenario analysis, emissions data and assurance.

Later developments

ASIC issued its sustainability reporting regulatory guide (RG 280) in March 2025. See our coverage of ASIC's guidance.

Sources

• ASIC: 24-205MR ASIC urges businesses to prepare for mandatory climate reporting
• Parliament of Australia: Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024, Bills Digest
• A&O Shearman: Australia, are you ready for the mandatory climate related financial disclosure regime?