- NZ – education and awareness raising needed when implementing climate risk reporting
- AU – Engagement with the accounting bodies referenced in recommendation on climate-related disclosures
- CA ANZ is committed to supporting our members as we continue to advocate and raise awareness about important sustainability issues including Climate change
Chartered Accountants ANZ (CA ANZ) recognises the importance of business to mitigate and adapt to climate change and the role our members can play in helping them. In February 2020, CA ANZ was one of the thirteen professional accountancy bodies globally who signed a call to action in response to climate change.
In our declaration we, as part of the global professional accountancy bodies, committed to:
- Provide our members with the training, support and infrastructure they need to apply their skills to the challenge.
- Support relevant market-based policy initiatives and incentives, consistent and well considered regulation, and more useful disclosure.
- Provide sound advice to help governments to create the policy and regulatory infrastructure necessary for a just transition to a net zero carbon economy.
Our call to action has featured in local media and we have seen increased engagement from government and regulators are a result.
Recently major events, such as the 2019/20 Australian bushfires, have catapulted climate change into the headlines highlighting the urgency for climate action in both Australia and New Zealand. CA ANZ has actively contributed towards developments in both countries, including in relation to climate change policy and climate-related risk disclosures.
The accountancy profession has a crucial role to play in addressing climate change.
In 2019, CA ANZ co-hosted consultation events as a part of the climate-related financial disclosures: understanding your business risks and opportunities consultation held by the New Zealand Government (by Ministry of the Environment and the Ministry of Business, Innovation and Employment). CA ANZ co-hosted 4 open forum sessions with over 150 attendees. During these sessions, the consultation proposals were further explored and questions and comments from attendees were addressed.
CA ANZ provided a formal submission to the consultation which included recommendations that:
- Prior to implementing an entirely new regime, regulators seek to understand and address the reasons for noncompliance with the existing regime (which includes an existing fiduciary duty on directors to report on material issues).
- The Financial Stability Board Task Force on Climate-related Financial Disclosures (TCFD) recommendations should form a subset of a wider external reporting framework which encompasses other forward-looking business risks.
- To the extent a new regime is introduced, comprehensive education must be put in place to raise awareness. Also, critical will be effective monitoring and enforcement, to ensure that appropriate reporting is carried out.
In particular, these recommendations were referred to within the Government’s final summary of submissions. Further reference was also made (in that summary) to our observations of the TCFD recommendations themselves.
Prospering in a low-emissions world: An updated climate policy toolkit for Australia (Policy toolkit) published by the Climate Change Authority is a report, that provides advice to the Government, outlining how Australia can reduce greenhouse gas emissions to meet its 2030 Paris Agreement Target and proposer in a world transitioning to global net zero emissions.
Representing the major accounting bodies in Australia, CPA Australia and CA ANZ prepared a joint submission which has contributed to the policy tool kit. In particular, recommending that
‘A joint taskforce of the Council of Financial Regulators should, together with the major accounting bodies examine the phasing-in and mandatory reporting of climate-related risks and mainstream climate-related disclosures in companies’ audited financial statements.’
Additional points from our submission that have been mentioned in the policy toolkit include:
- A clear, long-term signal like a mid-century target is important for investment and ensuring a smooth transition to a low-emissions economy
- The need for all levels of government to be part of the transition, along with businesses and communities
- we are against the use of carryover on the basis this weakens action to mitigate climate change
- Prudential regulation and the overarching role of central banks play a critical part in ensuring the timely and accurate pricing of climate-related risks in domestic and international financial markets, and so minimising the risk of large-scale build-up of stranded assets.
For further information, resources and CA ANZ’s continued advocacy on Climate Change refer to our website.
CA ANZ joins climate change call to action
The accounting profession can play a significant role in achieving both climate change mitigation and adaptation.Read CA ANZ’s call to action on climate change
Submission on climate-related financial disclosures in New Zealand
Climate-related financial disclosures – Understanding your business risks and opportunities related to climate change: Discussion documentRead submission here
New Zealand Government’s final summary of submissions on climate-related financial disclosures
Understanding your business risk and opportunities related to climate changeRead here
Prospering in a low-emissions world: An updated climate policy toolkit for Australia
Find out how Australia can reduce greenhouse gas emissions to meet its 2030 Paris Agreement target and subsequent, more ambitious targets; and prosper in a world transitioning to global net zero emissions.Read here
Joint submission on CCA Paris Agreement
Chartered Accountants ANZ and CPA Australia provided a joint submission representing the major accounting bodies in Australia.Read here