Australian Sustainability Reporting Standards: what you need to know

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How Australian climate compliance is reshaping corporate strategy

In 2024, Australia passed landmark legislation embedding climate disclosures into the very core of corporate accountability. Starting January 2025, large entities operating in Australia are required to comply with the Australian Sustainability Reporting Standards (ASRS). This is an International Sustainability Standards Board (ISSB)-aligned regime with special requirements across scenario analysis, assurance and liability.  

As of June 2025, Australia has joined the ranks of over 36 other jurisdictions in formally adopting or preparing to adopt the ISSB informed standards. The ISSB standards now represent the most widely adopted sustainability reporting framework globally. 

From voluntary to mandatory climate disclosures

The ASRS framework, developed by the Australian Accounting Standards Board (AASB), aligns closely with the IFRS S1 and S2 standards issued by the ISSB. It mandates reporting on climate-related governance, strategy, risk management, and metrics—alongside scenario analysis and Scope 1, 2, and (eventually) Scope 3 emissions. Importantly, it introduces: 

Phased assurance requirements, while ASRS starts with limited assurance for large entities, it quickly escalates to reasonable assurance by 2030 for all climate disclosures. 

Director liability, safe harbour and uncertainty provisions are built into the ASRS to recognise the challenges of reporting forward-looking climate risks. Scope 3 emissions and scenario analysis are treated with modified expectations, offering legal protection where uncertainty is high, so long as boards can demonstrate appropriate oversight. 

Mandatory dual scenario analysis, firms must disclose resilience based on a Paris-aligned (1.5ºC) scenario and a high warming (>2.5ºC) pathway. This is more stringent than TCFD requirements.  

Many global firms are treating ASRS compliance as a pilot for global readiness. 

Early action in Australia sends a signal to investors, auditors, and rating agencies. Companies that delay, risk falling behind their peers not just in compliance, but in trust. 

For large global businesses it raises both technical and strategic questions. Australia may not represent their largest market, but its legal obligations can now cascade across group-wide disclosures, internal controls, and investor expectations.  

Risilience recommends building interoperable disclosures to seamlessly plug into EU, UK and other global frameworks.  

ASRS rules are Australian specific 

Climate reporting under ASRS is rooted in domestic accountability. It applies only to entities operating in Australia that are already required to file financial statements under Chapter 2M of the Corporations Act 2001. This includes listed companies and many unlisted entities, whether locally owned, foreign-controlled, or functioning as inbound subsidiaries of multinational groups. 

If an Australian entity is not subject to Chapter 2M financial reporting, it falls outside the scope of ASRS. For those in scope, the requirement to report is based on the Australian business alone. Thresholds for revenue, assets, and employees are applied strictly to Australian operations, not global activity. A multinational may prepare ISSB-aligned reports at group level, but those cannot be substituted for entity-level disclosures under ASRS. Thresholds for reporting are shown in the table below. 

Similarly, because Australia requires compliance with only climate-risk disclosures (IFRS S2), it means that companies complying with the ASRS will likely need to disclose additional information to comply with other ISSB-aligned disclosure regimes such as the UK’s forthcoming UK Sustainability Reporting Standards.