A group of 20 of Australia’s largest business and finance bodies has come to a consensus on the need for sustainability disclosure including action on climate risk through a new reporting regime that strives to set a global baseline.
Some of the bodies that participated in the statement included CPA Australia, Chartered Accountants Australia and New Zealand and the Institute of Public Accountants along with 17 others.
The collection of bodies positively received the International Sustainability Standards Board (ISSB) draft sustainability standards in a joint submission.
The collection of business and finance bodies represents more than 400 companies, approximately 300 investors with US$33 trillion assets under management and 500,000 business and finance professionals.
The group identified that climate is a primary risk to the Australian economy and stated that it supported the Paris Agreement and its objective to achieve net-zero emissions however said the transition to achieving a net-zero emissions economy needed to be undertaken with care.
The collection of bodies agreed that clear, transparent, comprehensive and comparable disclosure of sustainability-related information needed to be part of the foundation of a properly functioning global financial system.
The bodies also supported the plan for a global approach to the development of sustainability disclosure standards and for the ISSB to be the global body overseeing these standards.
The group of 20 also concluded that the overarching goal should be a globally consistent and verifiable corporate reporting system so that all stakeholders could have a clear and accurate picture of an organisation’s ability to create sustainable value over time.
The Australian bodies stated that it would be critical for the ISSB and other jurisdictions developing the sustainability standards to take a coordinated approach to ensure there was no regulatory fragmentation by making sure key definitions, terminologies, and metrics on which disclosure requirements are built were aligned.
The group also outlined the importance of collaboration and coordination between sustainability disclosure initiatives and financial accounting standard setting and said that the ISSB was best placed to ensure this given its connection with the International Accounting Standards Board (IASB).
The bodies stated they were keen to work with the Australian government moving forward as well as national and international stakeholders as the climate change reporting regime is implemented.