August 2022
The Aotearoa New Zealand Climate Standards have now been published.
Declarations, disclosures and climate reporting can be tricky to understand. Abbreviations fly around (GRI, IR, TCFD, ISSB, XRB!), and which framework should you use? We’re fortunate the experts from the New Zealand External Reporting Board (XRB) joined our webinar series to help explain Aotearoa New Zealand’s forthcoming climate standards. The XRB’s Director of Sustainability Reporting, Dr Amelia Sharman, and Technical Advisor – GHG Emissions, Judy Ryan, spoke with thinkstep-anz CEO Barbara Nebel for the presentation.
Many of the themes discussed also apply to climate reporting in Australia.
Watch a sneak peek of the webinar:
Main webinar takeaways
Reporting bodies are here to help
New Zealand’s External Reporting Board (XRB) and the Australian Accounting Standards Board (AASB) are the bodies that administer reporting standards and frameworks. They’d also like to make sure you can follow them! Both bodies have resources that explain the standards, who and what they cover, and guide you through reporting.
How do the TCFD, ISSB and XRB frameworks interact?
- The Task Force on Climate-Related Financial Disclosures (TCFD) framework aims to give better information to the investment community about climate-related risks and opportunities. It was formed by the G20 Financial Stability Board in 2015.
- The climate related elements of the International Sustainability Standards Board (ISSB) framework have been modelled on TCFD standards. It aims to be the global baseline for climate disclosures. ISSB is a merger of international standard-setting bodies and is focused on investors and investors’ needs.
- XRB use TCFD and ISSB to develop their standards. If you have to report using the XRB standards, you’re a mandated climate reporting entity.
- The XRB standards are secondary legislation with clear penalties for failing to report – so XRB reporting should be your focus.
- XRB will give guidance on TCFD and ISSB if organisations wish to comply and report using those frameworks too.
Entities that are mandated to produce climate reports include registered banks and credit unions with total assets of more than $1 billion, and equity and debt issuers listed on the NZX with a market value greater than $60 million.
Frameworks can be complex – take the time to understand what applies to you
Is your reporting voluntary or mandated? Are you reporting in one, two or more countries? The XRB and/or AASB can guide you on which standard best applies, and the timeframes and formats to use.
Transparency is good
If your reporting is voluntary, you may omit certain parts of climate risk reporting. It’s good to be transparent about what is or isn’t covered. While you might not have to do a full climate report, banks and stakeholders will likely be interested in your climate-related risks or opportunities.
Please note: The Task Force for Climate-related Financial Disclosures (TCFD) has completed its work. The International Sustainability Standards Board (ISSB) now oversees climate-related financial disclosures. We still use TCFD as shorthand for climate-related disclosures as many people are familiar with this term.