New Climate Legislation Passed in Australia: What You Need to Know
Australia has just passed two landmark pieces of legislation aimed at addressing the urgent climate crisis, and the implications are significant for businesses across the country.
1. Mandatory Climate Reporting Starting in 2025
The first law mandates climate-related disclosures for large and medium-sized companies, including details on climate risks, opportunities, and greenhouse gas emissions across their value chains. This change will begin with the largest companies (those with 500+ employees, over $500 million in revenue, or more than $1 billion in assets) in January 2025. Medium-sized companies will follow suit in 2026, and smaller entities in 2027. This law ensures that businesses are transparent about their environmental impact and enables investors and stakeholders to better understand companies’ exposure to climate-related risks.
Scope 3 emissions reporting (covering indirect emissions in a company’s supply chain) will be phased in gradually, allowing companies more time to meet these requirements. This move aligns with international standards, positioning Australia as a global leader in corporate climate responsibility.
2. Establishment of the Net Zero Economy Authority
In a second significant step, Parliament voted to establish the Net Zero Economy Authority. This body will spearhead Australia’s transition to a net zero economy, aligning with the country’s 2050 climate goals. The Authority will focus on supporting workers in high-emissions industries, facilitating their reskilling for clean energy jobs. Additionally, it will coordinate efforts with industry leaders, regions, and investors to unlock new opportunities within the green economy.
With these two measures, Australia is joining other regions in the world in advancing strong climate change regulations. For companies, this means adjusting to a new era of transparency, while also preparing to seize opportunities emerging from the energy transition.
These changes mark a pivotal shift for Australian businesses, with far-reaching effects on how companies operate and report on climate-related activities. Subscribe to ensure you stay up-to-date with the latest changes in ESG regulations.
