Australia’s climate-related financial disclosure requirements are being phased in, with Group 2 and Group 3 entities commencing mandatory reporting from July 2026 and July 2027.

For many of these entities, this will be the first time they prepare climate-related financial disclosures as part of the annual reporting process. This will involve new governance, data collection, risk assessment, reporting and assurance processes.

CA ANZ’s new guide Navigating the Australian climate-related financial disclosure landscape: pathway for Group 2 and 3 entities is designed to support entities and their finance teams as they prepare. It focuses on entities starting their reporting journey now and provides practical guidance to help translate regulatory requirements into action.

What the guide covers

The guide is structured in two parts.

Part 1 provides an overview of the Australian climate-related financial disclosure landscape. It explains:

• who is required to prepare climate-related financial disclosures, and when
• how requirements are phased in over time
• what must be included in a mandatory Sustainability Report
• the role of AASB S2 Climate-related Disclosures
• how assurance requirements are being introduced.

Part 2 focuses on implementation. It outlines practical steps entities can take to prepare for first-time reporting, including:

• planning and defining scope
• establishing governance and oversight
• identifying climate-related risks and opportunities
• developing greenhouse gas emissions data and measurement processes
• integrating climate-related information into existing risk management and financial reporting processes
• preparing for assurance.

The guide also includes an indicative implementation pathway and timeline that entities can adapt to their own size, complexity, capability and reporting timetable.

Lessons from early reporters

The guide draws on practical insights from Group 1 entities that are already in the mandatory climate-related disclosure regime.

One clear message is that preparation takes time. Entities may need to build capability, document processes, collect new data, engage internal stakeholders and external consultants, and involve assurance providers early.

For Group 2 and Group 3 entities, starting early is essential to avoid compressed reporting timelines and support better-quality disclosures.