Mandatory Climate Reporting is coming – Is your business ready?
- Northmore Gordon
- February 12, 2025
- Articles
From FY26, businesses with over $500M in revenue must report climate risks and emissions under new Mandatory Climate Reporting rules, to ASIC. By FY28 all business over $50M in revenue will need to report. This shift will impact thousands of companies – are you prepared?
The Australian Sustainability Reporting Standards (ASRSAustralian Sustainability Reporting Standards (ASRS) - Australia's mandatory climate-related financial reporting rules started on 1 January 2025 and are being phased in across three reporting groups.) bring global alignment and greater transparency, ensuring investors and regulators can assess corporate climate impact. With reporting deadlines fast approaching, now is the time to understand the requirements and take action.
When does your business need to start reporting? (Meet two of the three reporting thresholds)
- FY26, Group 1: Over $500M turnover, more than 500 employees, or $1B in assets
- FY27, Group 2: Over $200M turnover, more than 250 employees, or $500M in assets
- FY28, Group 3: Over $50M turnover, more than 100 employees, or $25M in assets
Start preparing to meet these deadlines.
What does this mean for your business?
Why is ASRS happening? Australia’s Federal Government is committed to achieving 82% renewable energy, in the electricity grid, by 2030 and transitioning the country toward net-zero emissions by 2050.
Mandatory climate reporting under the ASRS plays a crucial role in this transition by:
- Promoting corporate accountability: More businesses are now expected to measure and disclose their environmental impact.
- Driving investor confidence: Clear and consistent reporting helps investors assess risks and opportunities tied to climate change.
- Encouraging sustainable business practices: By requiring transparency, the ASRS incentivises companies to adopt more sustainable and energy-efficient operations. It also urges them to put similar pressure on their suppliers and customers.
The business impact for businesses, the ASRS introduces several challenges and opportunities:
- Increased reporting obligations: Commencing FY26, many companies will be required to collect, analyse, and report detailed data on their emissions and climate risks. This requires robust internal systems and resources.
- Reputational risk and opportunity: Non-compliance or poor environmental performance will be exposed, damaging poor performers’ reputation. Conversely, demonstrating leadership in sustainability can enhance your brand image and attract new clients and investors.
- Operational adjustments: Companies will need to adapt their operations to reduce emissions and align with national sustainability targets. This may include investing in energy-efficient technologies or renewable energy.
- Regulatory scrutiny: Non-compliance with ASRS standards could result in penalties, increased regulatory oversight, and loss of stakeholder trust.
How to Stay Ahead
The ASRS isn’t just a regulatory requirement; it’s a chance to future-proof your business. By embedding sustainability into your strategy, you can improve efficiency, reduce costs, and create a competitive advantage.
At Northmore Gordon, we simplify the complexity of ASRS compliance. From carbon footprint assessments to net-zero strategy development, we’ll help you navigate these changes confidently and turn challenges into opportunities. Since 2009, we have been supporting our partners in reducing their energy demands, in doing so cutting costs by cutting carbon. We have market leading knowledge on how government can support you in your climate journey through grants, subsidies and certificate schemes.
Choose Northmore Gordon to turn plans into action and do more with less carbon.
Contact Jack Warren at j.warren@northmoregordon.com
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When must Australian businesses start mandatory climate reporting to ASIC, and what is the process called?
From FY26, businesses with over $500M in revenue must report climate risks and emissions to ASIC under new Mandatory Climate Reporting rules, part of the Australian Sustainability Reporting Standards (ASRS). By FY28, all businesses over $50M in revenue will need to report.
What are the three reporting groups and thresholds under the Mandatory Climate Reporting rules?
Businesses need to report once they meet two of the three thresholds for their group: FY26 Group 1 – over $500M turnover, more than 500 employees, or $1B in assets; FY27 Group 2 – over $200M turnover, more than 250 employees, or $500M in assets; FY28 Group 3 – over $50M turnover, more than 100 employees, or $25M in assets.
What is the ASRS and why is Australia introducing it?
ASRS stands for the Australian Sustainability Reporting Standards, Australia's mandatory climate-related financial reporting rules that started on 1 January 2025 and are being phased in across three reporting groups. It is being introduced to support the Federal Government's commitment to achieving 82% renewable energy in the electricity grid by 2030 and transitioning the country toward net-zero emissions by 2050.
How does mandatory climate reporting under ASRS help drive Australia's climate transition?
According to the article, ASRS plays a crucial role by promoting corporate accountability (requiring businesses to measure and disclose environmental impact), driving investor confidence (through clear and consistent reporting that helps investors assess climate-related risks and opportunities), and encouraging sustainable business practices (incentivising companies to adopt more sustainable, energy-efficient operations and pressure suppliers and customers to do the same).
What business impacts and risks does the article identify from the introduction of ASRS?
The article identifies four impacts: increased reporting obligations (companies must collect, analyse and report detailed emissions and climate risk data, requiring robust internal systems); reputational risk and opportunity (non-compliance or poor environmental performance damages reputation, while sustainability leadership can enhance brand image); operational adjustments (companies may need to invest in energy-efficient technologies or renewable energy to reduce emissions); and regulatory scrutiny (non-compliance could lead to penalties, increased regulatory oversight, and loss of stakeholder trust).
How can Northmore Gordon help businesses prepare for ASRS compliance?
Northmore Gordon simplifies the complexity of ASRS compliance, offering services from carbon footprint assessments to net-zero strategy development to help businesses navigate the changes confidently and turn compliance challenges into opportunities. The company has been supporting partners in reducing energy demand and cutting costs by cutting carbon since 2009, and has knowledge of government support available through grants, subsidies and certificate schemes.
Who should businesses contact at Northmore Gordon regarding mandatory climate reporting?
Businesses can contact Jack Warren at j.warren@northmoregordon.com regarding mandatory climate reporting and ASRS compliance.
Who wrote this article and what is their background?
The article is authored by Northmore Gordon, with author credit to Craig Morgan, a mechanical engineer with 30 years of experience, including more than fifteen years assisting organisations manage energy, greenhouse gas emissions and the impacts of climate change, seven years focused on energy management and greenhouse gas inventory development and mitigation, and six years on renewable energy generation systems.
Does meeting the ASRS reporting threshold require satisfying all three criteria (turnover, employees, assets)?
No. According to the article, businesses need only meet two of the three reporting thresholds (turnover, number of employees, or assets) for their respective group to be required to report.
When was this article about mandatory climate reporting published?
The article 'Mandatory Climate Reporting is coming – Is your business ready?' was published on February 12, 2025.
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