PERTH (miningweekly.com) – The federal government has released a consultation paper on detailed proposals that will help Australian companies and investors to maximise economic opportunities in the shift to cheaper, cleaner and more reliable energy, and to manage climate risks.

In a joint statement on Tuesday, Climate Change and Energy Minister Chris Bowen said that the proposed changes would give companies the confidence, clarity and certainty they need to invest, creating more jobs and opportunities for people in more parts of the country. 

The consultation paper is the next step in delivering the government’s commitment to ensuring Australia’s large business and financial institutions provide more information and greater transparency on how they are responding to climate change and contributing to the net zero transformation, said Bowen.

The proposals reflect feedback from industry, investors, financial regulators and the broader community, and public consultation is being undertaken for the next stage of this important work.

“Australian businesses and investors will benefit from clear expectations of how climate-related risks and opportunities should be reported, strengthening the overall stability of the Australian financial system.

“The consultation paper builds on existing climate disclosure practices in Australia to improve breadth, quality and sophistication of climate disclosures across a wider range of companies. At the same time, the proposals aim to ensure companies are afforded time to build internal capability and expertise to support climate disclosure,” the Minister said.

The paper outlines the proposed implementation approach including mandatory reporting requirements commencing from July 2024 for Australia’s largest listed and unlisted companies and financial institutions, with other businesses subject to the requirements over time.

The paper also outlines a three-year transitional period with regulator-only action against directors and reporting entities in relation to forward-looking statements and Scope 3 emissions possible during this time.  

Furthermore, the paper proposes the broad alignment with international climate disclosure standards.

Bowen said that feedback from this consultation would help shape legislative changes and inform engagement with Australian standard-setting bodies and regulators.  

“The government is committed to working with business, industry groups and the broader community to ensure we get these settings right. 

“The proposed climate reporting regime will form part of Australia’s broader sustainable finance framework. This will include a sustainable finance taxonomy, along with further initiatives to tackle greenwashing and strengthen transparency of sustainability-related financial products and markets.

“The net zero transformation is a defining economic opportunity for Australia and the government is wasting no time taking action. We have already made progress in legislating our commitment to net zero by 2050, updating our Nationally Determined Contribution to a 43% reduction in emissions by 2030, and implementing a range of measures to deliver on these goals.

“The government has also committed to legislate a national Net Zero Authority, which will work with state, territory and local governments, existing regional bodies, unions, industry, investors and First Nations groups to help key regions, industries, employers and others proactively manage the transformation to a clean energy economy.”

The 2023/24 Budget provided an additional A$4-billion to power Australia’s transformation into a renewable energy superpower, taking the government’s total investment to more than A$40-billion.

“Sustainable finance is a critical part of our climate agenda and with this action, financial markets will be much better placed to make the long-term investments needed to meet our targets,” said Bowen on Tuesday.

Submissions on the consultation paper will close on July 21.