Companies, investors and other stakeholders have been urged to provide feedback on draft sustainability reporting standards.
Global sustainability disclosure standards currently under consultation will “inevitably” have an effect on local markets if adopted, Australia’s corporate regulator has warned this week.
Australian companies and other stakeholders, including investors, other reporters, advisors and assurers, have been encouraged by ASIC to provide feedback to the International Sustainability Standards Board (ISSB) on ‘exposure drafts’ related to sustainability disclosure.
ASIC deputy chair Karen Chester said it was important for local companies and stakeholders to participate in the consultation to establish the proposed standards as a global baseline.
“Australian stakeholder feedback is essential to ensuring the ISSB’s final standards are appropriate and workable for our market and economy,” she said.
“Should the exposure drafts be adopted internationally, they will inevitably impact Australia’s capital markets and participants, as investors continue to demand comparable sustainability and climate-related corporate disclosures.”
The ISSB was established at the COP26 summit last year with the task of developing a single set of standards to meet the information needs of investors.
In March, the ISSB published two exposure drafts to set out general sustainability-related disclosure requirements and specify climate-related disclosure requirements.
“The publication of the exposure drafts is a major step towards setting global sustainability and climate-related disclosure standards,” Ms Chester said.
“The ISSB has worked at pace to meet the urgent demand for transparent and comparable reporting on sustainability and climate-related matters. Consistent, comparable and relevant information is critical for investors to make fully informed decisions here.”
Stakeholders can submit responses on the exposure drafts by participating in a survey or submitting a comment letter before 29 July.
While awaiting the new standards from the ISSB, ASIC encouraged directors and senior management of listed companies and their advisors to continue reporting voluntarily under the Task Force on Climate-Related Financial Disclosures (TCFD) framework.
ASIC has previously indicated that it is keeping a close eye on greenwashing and in June released an information sheet on the issue for superannuation and managed funds.
The corporate regulator said that it would be engaging with the ISSB’s exposure drafts through its membership in the Council of Financial Regulators Climate Working Group.
The council, whose members also include APRA, Treasury and the Reserve Bank, plans to provide a joint submission to the ISSB.
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.
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