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New Zealand Makes Climate Risk Reporting Mandatory

New Zealand Makes Climate Risk Reporting Mandatory

New Zealand has become the first country in the world to make climate risk reporting mandatory for banks, asset managers and insurers.

Under new legislation announced on September 15, 2020, large financial institutions would be required to report annually on governance, risk management and strategies for mitigating climate change impacts.

The country’s Minister for Climate Change, James Shaw, said the mandatory disclosure requirements, which are based on the Task Force on Climate-Related Disclosure (TCFD) framework, would be the first of their kind in the world.

“Australia, Canada, UK, France, Japan, and the European Union are all working towards some form of climate risk reporting for companies, but New Zealand is moving ahead of them by making disclosures about climate risk mandatory across the financial system,” he said.

New Zealand Makes Climate Risk Reporting Mandatory
New Zealand Makes Climate Risk Reporting Mandatory

The requirement will apply to around 200 institutions, including banks and institutional investors with more than $NZ1 billion ($920 million) in assets, and insurers with either $1 billion in assets or annual premium income of more than $NZ250 million. If the proposal passes parliament, the climate reporting would begin in 2023.

The move builds on New Zealand’s emerging legacy of climate action, such as its historic Zero Carbon Bill that committed the country to honoring the goals of the Paris agreement and achieving zero carbon emissions by 2050.

Reference

  1. https://www.afr.com/companies/financial-services/new-zealand-makes-climate-reporting-compulsory-20200915-p55vno.
  2. https://www.ecowatch.com/new-zealand-climate-risk-reporting-2647698323.html?rebelltitem=2#rebelltitem2.
  3. https://www.scoop.co.nz/stories/PA2009/S00127/new-zealand-first-in-the-world-to-require-climate-risk-reporting.htm.

New Zealand Makes Climate Risk Reporting Mandatory

Written BY: Kanishk

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