Where you operate will drive your sustainability reporting journey

In its second Treasury Consultation Paper, the Government proposes that by 2027-2028, all large Australian entities (including large proprietary companies lodging financial reports with the Australian Securities and Investments Commission (ASIC) under Chapter 2M of the Corporations Act 2001) will have to disclose sustainability-related financial disclosures in accordance in the following time-frames:

  • Group 1 entities – 2024-2045 onwards
  • Group 2 entities – 2026-2027 onwards
  • Group 3 entities – 2027-2028 onwards.

Please refer to our previous article for more information about the criteria for each group noted above.

2027-2028 may seem a long way off. Still, some companies may be forced to prepare sustainability disclosures earlier if either the parent company is based in a jurisdiction where sustainability reporting is compulsory, or they operate in an overseas jurisdiction that requires sustainability reporting.

New Zealand, Europe, the United States (USA) and Singapore are just a few jurisdictions that have already made sustainability reporting compulsory, or are about to. If you have a parent company or operate in these countries, please be aware that you may need to prepare sustainability disclosures now, or soon, and as part of this process, measure your greenhouse gas (GHG) emissions.

New Zealand

New Zealand already has mandatory climate reporting. The following types of large New Zealand entities must prepare climate-related disclosures for 31 December 2023 years:

  • Registered banks, credit unions, and building societies with total assets of more than NZ$1 billion
  • Managers of registered investment schemes (other than restricted schemes) with greater than NZ$1 billion in total assets under management
  • Licensed insurers with greater than NZ$1 billion in total assets, or annual premium income greater than NZ$250 million
  • Listed issuers of quoted equity securities with a combined market price exceeding NZ$60 million
  • Listed issuers of quoted debt securities with a combined face value of quoted debt exceeding NZ$60 million
  • Authorised Bodies, that are managers of registered schemes and operate under the licence of another manager, where the total assets under that licensee (including assets of all authorised bodies) exceeds $1 billion.

Australian entities that are subsidiaries of New Zealand entities noted above, must prepare climate disclosures now because their parent will need it! These entities will be required to report earlier than expected in Australia by four years for Group 3 entities, three years earlier for Group 2 entities and one year earlier for Group 1 entities (based on the timelines in Australian Government’s second Consultation Paper).

At the time of writing, the Financial Markets Authority (FMA) has agreed in principle to grant a five-year exemption to foreign exempt issuers from their New Zealand climate-reporting obligations in either of the following circumstances:

New Zealand operations

Type of relief

Conditions for relief

The foreign exempt issuer does not have significant business operations or investments in New Zealand

Full relief

Must comply with any mandatory home jurisdiction laws or home stock exchange requirements regarding climate-related disclosures

The foreign exempt issuer has significant business operations or investments in New Zealand

Partial relief

Climate reporting only for New Zealand business operations or investments (not global businesses or investments)


Significant business operations or investments in New Zealand means at least one of the following applies:

  • At balance date of each of the two preceding periods, total assets of the New Zealand business or New-Zealand-based investment assets exceeds NZ$1 billion
  • In each of the two preceding accounting periods, annual gross revenue for either the New Zealand business or New Zealand-based investment assets exceeds NZ$250 million.

We expect these exemptions for foreign exempt issuers to be issued by the end of calendar year 2023. Foreign exempt issuers whose primary listing is on the ASX with a secondary listing on the New Zealand Stock Exchange should consider whether any New Zealand operations or assets will trigger climate reporting for 31 December 2023.


The European Union’s (EU’s) Corporate Sustainability Reporting Directive (CSRD) came into force on 5 January 2023, and EU member states have 18 months to incorporate the CSRD into their national law. For some European entities, climate disclosures will be mandatory as early as next year - 31 December 2024.

What is CSRD?

The CSRD was designed to revise and strengthen the requirements of the Non-Financial Reporting Directive (NFRD). Its scope is much wider than the NFRD, covering more entities, and requiring more disclosures. Entities reporting under the CSRD will have to apply the disclosures contained in EU Sustainability Reporting Standards (ESRS), which includes one overarching disclosure standard, and eleven topical standards. ESRS was adopted by the European Commission on 31 July 2023.

Timeline for CSRD

The timeline for EU entities to report under the CSRD for the first time is shown on the table below.

Type of entity

First reporting year ending

Large public interest entities (listed companies, banks and insurance companies) with more than 500 employees

These entities are within the scope of the NFRD

31 December 2024


Listed companies (other than micro listed entities) not within the scope of NFRD

31 December 2025

Large companies/groups meeting two out of the following three criteria and not within the scope of NFRD:

  • More than 250 employees
  • More than €40 million turnover
  • More than €20 million total assets

This includes subsidiaries of non-EU groups.

31 December 2025

Listed SMEs

Small and non-complex credit institutions and captive insurance undertakings

31 December 2027

A non-EU group which generated more than €150 million turnover in the EU for the last two consecutive financial years and has either:

  • A subsidiary which has securities listed on any regulated EU market
  • Subsidiaries in the EU which meet the threshold for a large company/group as defined above
  • One or more branches in the EU generating more than €40 million turnover.

31 December 2028

What does this mean for Australian entities?

Certain Australian entities may need to prepare sustainability reports earlier than outlined in the second Treasury Consultation Paper. For example:

  • An Australian subsidiary of a large EU public interest entity will have to prepare sustainability disclosures for 31 December 2024 as part of the group’s consolidated sustainability report (in Australia, similar reporting deadlines will only apply if the entity is a Group 1 entity)
  • An Australian group with a large EU subsidiary will have to prepare sustainability disclosures for that subsidiary at 31 December 2025. This would be one year earlier than expected if the Australia group is a Group 2 entity and two years earlier if the Australian group is a Group 3 entity.

Non-EU groups will report by 31 December 2028, but will have to report in Australia by 31 December 2027/30 June 2028 at the latest.

Unless included in a consolidated group CSRD report, Australian entities will have to comply with the ESRS disclosure requirements, which are far more extensive than IFRS S1 and IFRS S2. Additionally, all of the above sustainability information must initially have limited assurance, to be expanded to reasonable (audit) assurance in future.

In our view, introduction of CSRD and ESRS presents an opportunity for forward-looking Australian organisations to get on the front foot with their sustainability reporting. Early adoption will allow entities to identify the reporting requirements that align with their current strategy and existing data and begin incrementally implementing reporting metrics. This could not only create a competitive advantage, but also reduce the workload and risks of facing a significant project when these disclosures become mandatory.


The U.S. Securities and Exchange Commission (SEC) has delayed action on finalising a rule requiring public companies (both domestic and foreign registrants) to disclose significantly enhanced climate-related disclosures in registration statements and annual reports (e.g. in Form 10-K or Form 20-F) until October 2023. Proposed financial statement disclosures would be presented in a footnote to the consolidated financial statements, while the other disclosures would be presented in a separately captioned filing prior to the management discussion and analysis (MD&A).

Certain proposed requirements are similar to the disclosure recommendations in the TCFD, which also forms the basis of many of the proposed disclosure requirements in the ISSB’s climate standard IFRS S2.

Timeline for proposals

The table below shows the proposed timeline for SEC registrants to provide climate-related disclosures, as well as required assurance. These rules are likely to apply to most foreign private issuers, so will affect Australian entities with this status.

Class of entity






Large accelerated filers

All proposed disclosures, but excluding Scope 3

Scope 3 disclosure

Limited assurance


Reasonable assurance


Accelerated filers and non-accelerated filers


All proposed disclosures, but excluding Scope 3

Scope 3 disclosure

Limited assurance


Reasonable assurance

Small reporting companies



All proposed disclosures, but exempt from Scope 3



Australian entities with or without US operations may have to prepare climate-related disclosures earlier for the SEC than for ASIC. For example, if the proposals are approved, an Australian subsidiary of the following types of US filers will have to prepare climate-related disclosures to feed into the US parent’s Form 10-K as follows:

  • Large accelerated US filer - for 31 December 2023
  • Accelerated or non-accelerated US filer - for 31 December 2024
  • Small reporting company – 31 December 2025.

Australian sustainability reporting is likely to only commence for 2024-2025 at the earliest, and this is for the largest entities (Group 1) only.

Australian entities trading as foreign private issuers will also likely have to report early. This will depend on which type of filer they are.


In July 2023, the Accounting and Corporate Regulatory Authority (ACRA) and Singapore Exchange Regulation (SGX RegCo) launched a public consultation on the recommendations by the Sustainability Reporting Advisory Committee (SRAC) to advance climate reporting in Singapore. The consultation period closes on 30 September 2023.

If finalised, the recommendations would require Singaporean entities to report climate-related disclosures using International Sustainability Standards Board (ISSB) baseline standards as follows:


Report in accordance with ISSB baseline climate-related disclosure standards (with reliefs)

Report Scope 3 GHG emissions

Obtain external limited assurance over Scope 1 and Scope 2 GHG emissions


Financial years beginning on or after 1 January

All listed issuers (including those incorporated overseas, business trusts and real estate investment trusts)




Non-listed companies with annual revenue of at least S$1 billion




Non-listed companies with annual revenue of at least S$100 million to less than S$1 billion

A review will be conducted in 2027 with a view to mandating climate disclosures by around 2030


Source: Table 1: Proposed implementation timeline, Turning Climate Ambition into Action in Singapore - Recommendations by the Sustainability Reporting Advisory Committee

Group 3 Australian subsidiaries of listed issuers would need to prepare climate-related disclosures to feed into the Singaporean group filing two years early (i.e. 2025 instead of 2027-28), but subsidiaries of non-listed companies would prepare climate information for the Singaporean group at the same time.

Australian incorporated entities listed on the Singapore Exchange (SGX) are also likely to have to report by 2025. Depending on size, this may or may not be earlier than Australian first-time reporting dates.

How BDO can help

No matter where you are on your sustainability journey, our national team of sustainability experts can help with:

  • Sustainability reporting
  • Developing your sustainability strategy
  • Carbon footprint calculations or mandatory climate-related disclosures
  • Carbon emission reduction strategies
  • Assurance over your carbon footprint or sustainability reporting.

Contact us today.