The AASB S2 cross-industry metrics apply to every entity regardless of industry. Paragraph 29 of AASB S2, issued by the Australian Accounting Standards Board (AASB) in September 2024, requires information relevant to seven categories.
Key points
- Seven categories required of every entity under paragraph 29
- Covers emissions, transition and physical risk exposure, opportunities, capital, carbon price and remuneration
- Scope 1 and Scope 2 split between the consolidated accounting group and other investees
- Aus23.1 and Aus37.1 link the categories to strategy disclosures and targets
- Industry-based metrics are not required in Australia
The seven metric categories
| Category | What is disclosed | Paragraph |
|---|---|---|
| Greenhouse gas emissions | Absolute gross Scope 1, Scope 2 and Scope 3 emissions in metric tonnes of CO2 equivalent | 29(a) |
| Climate-related transition risks | The amount and percentage of assets or business activities vulnerable to transition risks | 29(b) |
| Climate-related physical risks | The amount and percentage of assets or business activities vulnerable to physical risks | 29(c) |
| Climate-related opportunities | The amount and percentage of assets or business activities aligned with climate-related opportunities | 29(d) |
| Capital deployment | The amount of capital expenditure, financing or investment deployed towards climate-related risks and opportunities | 29(e) |
| Internal carbon prices | Whether and how a carbon price is applied in decision-making, and the price for each metric tonne of emissions used | 29(f) |
| Remuneration | Whether and how climate-related considerations are factored into executive remuneration, and the percentage of executive management remuneration recognised in the period that is linked to them | 29(g) |
More detail on greenhouse gas emissions
The emissions category carries the most detail. An entity explains the approach, inputs and assumptions it used to measure emissions and why. It splits Scope 1 and Scope 2 emissions between the consolidated accounting group and other investees such as associates, joint ventures and unconsolidated subsidiaries. It reports Scope 2 on a location-based basis, with information about contractual instruments where that helps users understand the figure. It also states which of the 15 Scope 3 categories are included.
Australian additions
AASB S2 asks an entity to refer to these categories when preparing its strategy disclosures (Aus23.1) and when choosing the metrics it uses to set and track targets (Aus37.1). Unlike IFRS S2, it does not require industry-based metrics, and the AASB’s technical FAQs confirm an entity need not refer to or consider the SASB Standards. For the risk and opportunity metrics in paragraph 29(b) to (d), the entity uses all reasonable and supportable information available without undue cost or effort (paragraph 30).
Why it matters for asset-intensive operations
Only the first category is an emissions figure. The other six draw on the fixed asset register, the capital plan, investment appraisal and remuneration records. That makes the cross-industry metrics a finance and operations exercise as much as a sustainability one, and it means the figures should reconcile to the same asset and project data used in the financial statements.
References & sources
Primary regulatory documents and authoritative references underpinning this answer.