Greatest Good April 2024 Regulatory Update
Mandatory climate-related financial disclosures legislation
The Federal Government introduced a Bill that seeks to legislate requirements for mandatory climate-related financial disclosures. It generally follows the exposure draft legislation released in January (refer January Update), with some of the following key changes:
- deferred start date - the start date is linked to the legislation being passed in Parliament but will be no earlier than the financial years beginning on or after 1 January 2025, which is at least six months later than originally planned
- scope for clarifications - the legislation now explicitly states that only entities that have financial reporting obligations under the Corporations Act 2001 will be required to meet sustainability reporting requirements. This means entities not required to report under the Act, such as some charities reporting under the Australian Charity and Not-for–Profit Commission Act 2012, may not need to meet these obligations
- directors declaration on sustainability report - a modified form of the directors declaration will apply for the first three years, where the directors will add to the following to the start of their declaration: the entity has taken reasonable steps to ensure the substantive provisions of the sustainability report are in accordance with the Corporations Act 2001
- definitions linked to sustainability standards - a number of definitions, such as Scope 1, 2 and 3 greenhouse gas emissions, are now linked to this capability standards, rather than being defined in legislation
The legislation is expected to be passed by the end of 2024, with a start date of 1 January 2025.
Disclaimer: This does not purport to be comprehensive or to render legal advice. You should not act based on any information contained in this publication without first obtaining specific professional advice. Consult your legal advisor to determine if this applies to you.
