An AASB S2 sustainability report is a separate report required by section 292A of the Corporations Act 2001. It sits alongside the financial report and the directors’ report in the annual reporting package, is subject to assurance and modified liability, and is lodged with ASIC.
Key points
- Required by section 292A and set out in section 296A(1) of the Corporations Act
- Three parts: climate statements, notes, directors' declaration
- Directors declare reasonable steps for years beginning up to 31 December 2027, then compliance
- Group 3 entities with no material climate risks or opportunities may lodge an explained statement instead
- Same reporting entity and period as the financial statements unless the law permits otherwise
The three parts of the report
| Part | What it contains |
|---|---|
| Climate statements | The disclosures required by AASB S2 on governance, strategy, risk management, and metrics and targets, together with the scenario analysis the Corporations Act requires |
| Notes to the climate statements | Any notes required by the sustainability standards or by legislative instrument. ASIC notes that none are currently prescribed |
| Directors’ declaration | A declaration by the directors about the report’s compliance with the Corporations Act and AASB S2 |
The directors’ declaration
For financial years beginning between 1 January 2025 and 31 December 2027, directors declare that the entity has taken reasonable steps to ensure the report complies. From financial years beginning on or after 1 January 2028, they declare whether the report is in accordance with the Corporations Act and AASB S2, as they do for the financial statements.
Entities with no material climate-related risks or opportunities
A Group 3 entity that concludes it has no material financial risks or opportunities relating to climate can lodge a statement to that effect, with an explanation of how it reached that conclusion, instead of full climate statements. The conclusion must be supported by an assessment under the materiality requirements of AASB S2, and the statement is included in the auditor’s first-year review.
What else applies
The climate statements must include the two scenarios the Corporations Act requires: a 1.5°C scenario and one well exceeding 2°C. The report covers the same reporting entity and period as the related financial statements unless the law permits otherwise, and sustainability records must be kept for seven years.
Why it matters for asset-intensive operations
The sustainability report is lodged on the same timetable as the annual report, so emissions, risk and financial effects data must close alongside the financial year end rather than months later.
References & sources
Primary regulatory documents and authoritative references underpinning this answer.