New Climate Reporting Laws Passed: Businesses Face New Disclosure Requirements

Mandatory climate reporting laws sailed through the Australian Senate on Aug. 22 with the Labor government obtaining support from the Greens and independents.
The law will enforce climate reporting for large companies from January 2025 and extend to more companies over time.
Treasurer Jim Chalmers said the regime would improve investment in “cleaner, cheaper energy” in the move towards net zero.
“These critical reforms provide investors and companies the clarity and certainty they need to support the net-zero transformation, and further strengthen Australia’s reputation as an attractive destination for international capital.”
Both pointed to Treasury analysis that revealed a $2.3 billion (US$1.5 billion) compliance burden on Australian businesses.
“The United States, Canada, Japan, and most of Australia’s trading partners do not require the reporting of scope three emissions,” the Coalition adding, noting the costs would be passed down the supply chain to smaller businesses.
This could include a “farmer banking with a big company” to a “cafe owner in the lobby of a big company.”
Shadow Treasurer Taylor was concerned this could see the scope of “green tape” expand.
The second applies for companies fulfilling two out of the following three: revenue of more than $200 million, assets of $500 million, and 250 employees or more.
And the final stage will apply to companies that satisfy two of the following: revenue exceeding $50 million, gross assets exceeding $25 million, and 100 or more employees.
Small and medium businesses that are below these thresholds will be exempt at this stage, however, this could change.
“This is because the scope 3 emissions of a large business with reporting obligations may include the emissions of its small business suppliers. Scope 3 emissions are those emissions that occur up or down a company’s supply chain,” ASIC explained