Date posted: 21/08/2020 2 min read

Requirement for local authorities and lifeline utilities to report on climate risk

The Ministry for the Environment has announced that it will begin asking local authorities and lifeline utilities to make climate change-related disclosure from the end of this month.

In Brief

  • Local authorities and lifeline utilities may be subject to a request to make disclosure of their climate-related risk
  • The Ministry for the Environment will commence requesting disclosure from the end of August
  • Organisations should be preparing to report on governance around climate related risk, impacts of climate change on the organisation’s strategy, risk management, and metrics and targets used to assess climate-related risks.

Under the Climate Change Response (Zero Carbon) Amendment Act 2019 (the Act), the Minister for Climate Change and the independent Climate Change Commission have the power to request information from organisations that provide essential public services in New Zealand.

From the end of August, the Ministry for the Environment has indicated that they will be exercising this power with respect to the following entities listed in section 5ZW of the Act:

  • lifeline utilities, which are public and private-sector entities providing fuel, electricity, water, transport, and telecommunications infrastructure;
  • local authorities;
  • central government, crown entities, and state-owned enterprises;
  • the Police and New Zealand Defence Force.

Requests will likely focus on how organisations are adapting to climate change-related hazards, and may cover governance activities related to climate related risk, the impacts of climate change on the organisation's strategy, risk management, and metrics and targets used to assess climate-related risks.

Further information on responding will be provided to organisations at the time the request is made.

These requests are intended to inform development of the national adaptation plan and future national climate change risk assessments.

And, while this process does not fall within the currently proposed mandatory climate-related financial disclosures regime, the power to request information under the Act is still aligned with the Taskforce on Climate-Related Financial Disclosures (TCFD) framework, and is an example of the nature of reporting obligations in this area.

For more information, please click here.

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