Date posted: 08/03/2023

Members continue to support CA ANZs climate change advocacy

Investors are calling for robust and reliable climate-related financial disclosures and members continue to recognise the opportunities that this presents

In brief

  • Survey shows members continue to back CA ANZ’s active role on climate change
  • Investors continue to expect capital markets to provide robust and reliable climate-related risk disclosures
  • Chartered accountants have the skills and expertise to apply to reporting and assuring climate-related financial disclosures

Chartered Accountants in Australia and New Zealand strongly support CA ANZ taking an active role on climate change and an even greater number want to know more about how to do their bit, as shown by a recent survey of members.

There are compelling reasons for accountants to act on climate change. Take, for example, BlackRock Inc.’s CEO Larry Fink’s annual letter to other chief executives. This letter and many of its previous iterations recognise climate-related risks as investment risks.

Fink comments that “[a]s the transition accelerates, companies with a well-articulated long-term strategy, and a clear plan to address the transition to net zero, will distinguish themselves with their stakeholders – with customers, policymakers, employees and shareholders – by inspiring confidence that they can navigate this global transformation.”

Investors continue to expect capital markets to provide robust and reliable climate-related risk disclosures.

Standard setters, policy makers and voluntary frameworks are already addressing climate related financial disclosures and leading companies are already reporting this information.

For example, the IFRS Foundation Trustees, in light of the responses to last year’s consultation, are working towards establishing a Sustainability Standards Board that would be responsible for developing global sustainability reporting standards, with an initial focus on climate.

The Group of Five have released a climate-related financial disclosure standard protype. For reference, the Group include the Climate Disclosure Standards Board (CDSB), CDP, the Global Reporting Initiative (GRI), the International Integrated Reporting Council (IIRC) and the Sustainability Accounting Standards Board (SASB).

As the transition accelerates, companies with a well-articulated long-term strategy, and a clear plan to address the transition to net zero, will distinguish themselves with their stakeholders – with customers, policymakers, employees and shareholders – by inspiring confidence that they can navigate this global transformation.
Larry Fink, CEO and Chairman of BlackRock Inc.

In the meantime, New Zealand has introduced mandatory climate risk disclosure legislation to be supported by accounting standards developed by the External Reporting Board (XRB). And, regulators in Australia continue to stress the importance for companies to consider and disclose non-financial risks including climate change risk, as a part of existing risk frameworks and reporting disclosure (see our submission on the inquiry into the prudential regulation of investment in Australia’s export industries).

As investors seek to further rely on climate change disclosures for their decision making, there will be increasing demand for assurance over the information – as is the case with the legislation introduced in New Zealand with its requirement for independent assurance over disclosures relating to greenhouse gas (GHG) emissions.

Chartered accountants have the skills and expertise to apply to the reporting and assurance of climate-related financial disclosures. This is an opportunity for businesses and practices.

CA ANZ, in conjunction with other global accountancy bodies, has been actively raising awareness with members of the important role they can play in helping organisations mitigate and adapt to climate change.

From the survey undertaken, a similar majority of our members understand the role accountants can play. To support this role, members have requested further education as can be seen below.

Should CA ANZ produce education content to support members on climate change?

Members continue to support CA ANZs climate change advocacy. 48% strongly agree. 35% somewhat agree. 10% neither agree or disagree. 4% somewhat disagree. 4% strongly disagree.