The Joint Standing Committee on Trade and Investment Growth called for submissions on its Inquiry into the prudential regulation of investment in Australia’s export industries (the Inquiry).
The Inquiry covers issues that are of great importance to members of both CA ANZ and CPA Australia, particularly in respect of the responsibility to act in the public interest.
A critical element in investment decision-making is being aware of all factors that may impact that investment in the short, medium and long term, and members have a role to play in providing investors with reliable and accurate information. Of relevance to export industries is the effect of climate-related matters, including climate-related financial risks, on business.
To this end, the joint submission provides an overview of the current frameworks, principles and developments in this space that are most relevant to the Inquiry. This is provided with respect to points 2, 3 and 5 of the Inquiry’s terms of reference.
Taken together, these developments illustrate a recognition both in Australia and internationally of 1) the growing demand in capital markets for robust and reliable climate-related financial information, and 2) the role that regulators play in providing a framework for this disclosure. These developments are further strengthened by regulators and standard setters who are providing greater clarity on the applicability of materiality to information related to non-financial matters.