Australian Securities and Investments Commission (ASIC) chair Joe Longo has voiced his support for Australia to align with global sustainability reporting standards.
In a speech at a Deakin Law School conference on sustainability reporting, Longo said the corporate regulator supported aligning emerging Australian climate reporting rules with those developed internationally.
ASIC’s intervention in the debate on climate reporting guidance comes as the Australian Accounting Standards Board (AASB) and parts of the accounting profession are in dispute over the way reporting standards will be applied when new laws pass parliament.
An AASB proposal only covers climate-related reporting while professional bodies such as the Chartered Accountants in Australia and New Zealand and CPA Australia are in favour of aligning Australian global sustainability reporting rules issued by the London-based International Sustainability Standards Board.
Longo used the Deakin presentation to support aligning Australia’s climate reporting framework with global rules.
“We’re right on the cusp of this potentially becoming domestic Australian law,” Longo said. “There’s still a lot of work ahead of us to work through what the standards will look like in the Australian context.
“ASIC supports aligning the Australian standards to international standards as much as possible. This is, of course, a matter for the Parliament and the AASB, but minimising divergent climate reporting requirements between different jurisdictions would likely improve market efficiency, the competitiveness of Australian companies and reduce the regulatory burden for reporting entities.”
The ASIC chair also used his presentation to warn companies they should not wait for laws to pass parliament before they began to work out what records they needed to keep.
He said there was already a cohort of listed companies that reporting climate-related information, but that there are entities that would be nervous about having to report in accordance with new requirements.
“Nearly 75% of the ASX200 have committed to or are already voluntarily reporting climate-related information against the [Climate Financial Disclosure] framework,” Longo said.
“The same is not necessarily true of some of the smaller entities. But for both the smaller and the larger entities, there is some understandable apprehension, because now the legislation is actually upon us.”
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