Climate reporting steps into the boardroom as mining companies face tougher rules that turn sustainability into a test of strategy and resilience

When it comes to climate disclosures, Australia’s regulators are no longer asking politely - they’re pulling companies into the boardroom and telling them to talk numbers.

In a recent AusIMM webinar delivered in partnership with ERM, two seasoned sustainability advisers - Dr Mary Stewart, Partner at ERM and leader of the firm’s Climate and Energy Transition services across Australia and New Zealand, and Victoria Cross, ERM Partner and strategist with nearly three decades of ESG reporting experience - unpacked the Australian Sustainability Reporting Standards (ASRS) and what they mean for mining and resources companies.

The discussion made it clear: this isn’t sustainability reporting as usual. ASRS is a step change, one that links climate directly to financial disclosures and puts boards, auditors, and investors squarely in the spotlight.

From voluntary to mandatory

Mary opened with a blunt message: “Australia is not going it alone. What we’re seeing is part of a global movement towards mandatory climate-related disclosures. New Zealand was first in the region, and now Australia is moving quickly with the first reports due at the start of next year.”

The standards, embedded into the Corporations Act, will require companies to disclose climate-related governance, strategy, risk management, and emissions data in their financial reports. For tranche one reporters, that means disclosing FY26 data — or, for calendar-year reporters, covering the 2025 reporting period.

“This is not something you can park in a glossy sustainability report six months later,” Mary explained. “Your climate disclosures will be part of your financial report, lodged within three months of year-end.”

The tighter timelines, she said, mark a turning point. Companies that once treated sustainability reporting as an optional extra will now need to integrate climate disclosures into core business processes.

Four pillars, familiar but tougher

ASRS builds on four familiar pillars - governance, strategy, risk management, and metrics/targets - echoing the Task Force on Climate-related Financial Disclosures (TCFD). But there are sharper edges.

“Governance means showing how climate risk is managed from site to boardroom. Strategy means demonstrating how climate change impacts your business model and long-term viability. Risk management means embedding climate alongside financial and operational risk — not in a parallel silo. And measurement means putting hard numbers around emissions across scope 1, 2 and, eventually, 3,” Mary said.

She noted that while assurance will start with a light touch, it won’t stay that way. Limited assurance will apply from the first year, expanding across the breadth of ASRS, with reasonable assurance required from FY29 onwards.

Boards in the firing line

One of the most striking shifts is in governance. As Mary put it: “ASIC is taking a supportive supervision role, but they expect boards to engage seriously. They’ve been clear that directors can’t hide behind sustainability teams anymore.”

Victoria reinforced the point, warning that many boards are unprepared. “We’re seeing insufficient oversight in some cases, and directors without the skills to properly interrogate climate disclosures. It’s becoming a directors’ duties issue,” she said.

Her advice: build climate capability at board level, and give directors time and information to ask difficult questions. “This isn’t just about compliance. Investors want to see that companies are resilient and future-ready.”

Strategy integration — the missing link

Mining companies are no strangers to extreme weather. Cyclones, bushfires, and drought are part of the operating landscape. But, as Victoria observed, the industry often treats those events as tactical disruptions rather than strategic drivers.

“Where companies are struggling is making the link between physical climate risks and long-term strategy,” she said. “It’s not enough to say, ‘We know how to manage a flood.’ The question is: how does that risk shape your investment decisions, your asset life planning, your business model?”

She shared an example from a large mining operator modelling the potential phase-out of fuel tax credits. “They’re quantifying what regulatory change could mean over different time horizons, and that’s exactly the sort of thinking this regulation is designed to drive,” she said.

Compliance costs and hidden benefits

Victoria was candid about the cost burden. “We know the audit bills are eye-watering. We know internal teams are stretched. And if you approach this inefficiently, costs and frustration spiral,” she said.

Yet she argued that early movers are already seeing benefits. “Group one reporters who are deep into this work are beginning to feel the resilience dividend. For the first time, in some organisations, boards are having meaningful conversations about climate risks and opportunities.”

Mary added that investor confidence is the ultimate payoff. “A target without a plan is just a wish. Investors want to see credible transition plans, because if you don’t know how you’ll achieve your targets, you haven’t de-risked your business model.”

Assurance is no afterthought

Both speakers stressed the need to treat assurance as a process, not a last-minute sign-off.

“We’ve seen organisations spend a month going back and forth with auditors on just one section of disclosure,” Victoria said. “If you think you can drop a pile of climate data on your auditor three months after year-end, you’re in for a shock.”

Mary suggested a phased approach: “Some companies are getting assurance on the first nine months of data, so the final audit only has to cover the last quarter. Others are deep-diving into specific modules. The point is, don’t wait — build the relationship with your auditor now.”

Practical pain points

The speakers highlighted common stumbling blocks:

• Resourcing: “Insufficient people and dollars are a recurring theme,” Victoria said. “This work requires project management skills as much as technical expertise.”

• Data systems: “Spreadsheets won’t cut it,” she noted. “Companies are investing in digital systems to manage climate data with the same rigour as financial data.”

• Internal politics: “We’re seeing climate disclosures move from sustainability teams into finance, risk, and legal — often with limited climate knowledge. That handover is politically fraught,” she added.

• Individual fatigue: “We’re meeting beleaguered individuals suddenly responsible for ASRS. It’s overwhelming. The best advice is to share the load — collaborate across teams and bring in external critical friends to challenge your assumptions,” she said.

Materiality as the anchor

When asked about the most common risk of non-compliance, Victoria didn’t hesitate: “Financial materiality is the foundation stone. Auditors are pushing back where they feel disclosures don’t go far enough in declaring what’s material. It’s less about content, more about process. Be crystal clear on how you determine financial materiality, and get your auditor comfortable early.”

Mary added that clarity also matters for targets. “Targets aren’t mandatory in the first year. But if you set them, they must be defensible. That means aligning with frameworks like the Science Based Targets initiative and showing investors how your targets feed into a credible transition plan.”

What if you’re not captured

Some companies won’t meet the thresholds for ASRS reporting. But Mary warned against complacency.

“You will still be in someone’s scope 3 value chain,” she said. “Clients will demand data. And by the time we reach the third tranche, only very small companies will be outside scope.”

Victoria added that investors and lenders are already asking the questions. “Even if you’re not captured, if you want to raise capital, you’ll need to show you understand your climate risks and opportunities. Banks and investors are aligning with science-based targets, and that cascades down the chain.”

Building careers in climate reporting

For professionals wondering about the skills needed in this emerging space, Mary had pragmatic advice. “You can’t be single focused. You need to understand both business and sustainability — how to translate production risks into financial terms. Dual skills are critical.”

Victoria added that project management and influencing skills are just as valuable as technical expertise. “This is about managing an efficient process and engaging stakeholders across the business. If you’ve got those skills, opportunities are opening up everywhere.”

The bottom line

The webinar’s central message was simple: ASRS is not a box-ticking exercise. It’s about treating climate risk with the same rigour as financial reporting — and embedding it into governance, strategy, and risk management.

As Mary summed up: “This is a step change. It’s forward-looking, uncertain, and more like an IPO than a financial audit. But it’s law, it’s here, and it’s about building resilient business models for a carbon-free future.”

Or, in Victoria’s words: “Think of this as a business resilience project, not a compliance exercise. Those who do will not only satisfy regulators — they’ll win investor trust and strengthen their future.”