Property Council Submission to the Climate-Related Financial Disclosure Exposure Draft Legislation

The Property Council of Australia welcomes the opportunity to provide comments on proposed amendments to parts of the Australian Securities and Investment Commission Act 2001 (Cth) and the Corporations Act 2001 (Cth) (the Draft Legislation) that will introduce mandatory requirements for large businesses and financial institutions to disclose their climate-related risks and opportunities.

These are important reforms, and our industry supports the Australian Government’s ambition to enhance business transparency through quality climate-related financial disclosures. However, we remain concerned that the timing proposed to phase in reporting is inadequate to allow industry preparedness, particularly in relation to Scope 3 emissions in the built environment.

We note that we are also currently engaged with the Australian Accounting Standards Board (AASB) to provide industry feedback on the ASRS exposure drafts.

While we support the development of these standards to align with international frameworks, policy settings, inclusive of the ASRS and the Draft Legislation now put forward by Treasury, must be appropriate for the Australian context. We have outlined our feedback below for consideration. 

The Property Council’s key priorities in relation to the implementation of Climate-related Financial Disclosure are set out below.

1. The Draft Legislation requires amendment to clarify that Group 1 reporting entities are limited to ‘controlling corporations’ that meet the NGER publication threshold.
2. The timing proposed to phase in reporting is inadequate to allow industry preparedness.
3. Modified liability should be extended to all forward-looking disclosures and remain in force until the Australian Government has completed its post-implementation review.
4. It is not reasonable expose directors to personal liability for compliance with the new sustainability standards through unqualified declarations.
5. We do not support the eventual requirement that all disclosures have reasonable assurance.
6. Disclosure of Scope 3 material emissions is complex in the property sector and should be voluntary until there is accepted industry practice.
7. There is a need to provide industry-specific reporting metrics and guidance.