The Australian government has released the Sustainable Finance Roadmap (the roadmap) to boost private capital in sustainable finance. The roadmap helps investors, companies, and the broader community make net zero transition decisions.
The roadmap focuses on three pillars, each underpinned by actionable items and reforms. These pillars include:
Improving transparency on climate and sustainability
Financial system capabilities
Australian government leadership and engagement
Climate-related financial disclosure
The AFGC is focusing on the upcoming implementation of mandatory climate-related financial disclosure (CRFD) requirements, set to commence from 1 January 2025. The roadmap outlines the next steps of the implementation plan, including:
Australian Accounting Standards Board (AASB) will finalise standards that inform and underpin disclosure requirements, anticipated by August 2024.
Australian Auditing and Assurance Board (AUASB) will develop assurance standards in late 2024, aligning with international assurance standards released in September 2024.
Australian Securities and Investments Commission (ASIC) will consult and assist reporting entities to meet the new reporting requirements, including guidance and assessing impacts on current financial reporting relief.
The Government will consult on consolidating financial reporting bodies before introducing legislation for a new reporting regime.
Treasury will review the new requirements in 2028-29.
The AFGC sustainability team is prioritising CRFD and Scope 3 reporting support for members. As more information on CRFD guidance, consultation, and other activities becomes available, we will provide updates to members. In the meantime, if you have questions, concerns or comments, please contact Sarah Collier (sarah.collier@afgc.org.au) or Kristy Barber (kristy.barber@afgc.org.au).
Full Reform Timeline
The full list of reform priorities and implementation timelines are summarised in the table below.
Priority
Next Steps
Timeline
Pillar 1: Improving Transparency on climate and sustainability
AASB to finalise climate-related disclosure standards by August 2024. AUASB to develop assurance standards for climate in late 2024. Consultation on guidance and new reporting body.
2024-2025
Developing the Australian Sustainable Finance Taxonomy
ASFI to finalise the initial Australian Sustainable Finance Taxonomy.
End of 2024
Supporting credible net zero transition planning
Treasury to develop and publish best practice guidance for corporate transition plans.
End of 2025
Developing sustainable investment product labels
Public consultation on sustainable investment product labelling in early 2025. Regime commencement targeted for 2027.
2025-2027
Pillar 2: Financial System Capabilities
Enhancing market supervision and enforcement
ASIC to continue addressing market misconduct, including greenwashing surveillance and enforcement.
2024-2025
Identifying and responding to systemic financial risks
APRA to publish findings of Insurance CVA by mid-2025. CFR to expand work on climate and sustainability-related financial risks.
Mid-2025
Addressing data and analytical challenges.
CFR to make recommendations for addressing sustainability data challenges to Government in early 2025.
Early 2025
Ensuring fit-for-purpose regulatory frameworks
Government to consider stakeholder feedback on superannuation performance test. Ongoing work with regulators and stakeholders.
Ongoing
Pillar 2: Australian Government Leadership and Engagement
Issuing Australian sovereign green bonds
Annual allocation and impact reporting to commence in 2025.
2025
Stepping up Australia’s international engagement
Ongoing international engagement with focus areas, including ASEAN, G20, and bilateral agreements.
