A New Climate For Financial Reporting: Mandatory Sustainability Disclosure Obligations

From 1 July 2026, the second group of companies required to lodge financial reports under Chapter 2M of the Corporations Act will be subject to the mandatory sustainability disclosure obligations introduced by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024.

Australia has officially transitioned to a mandatory climate-related disclosure regime, amending Chapter 2M of the Corporations Act 2001 to require in-scope Australian entities to prepare and lodge a sustainability report alongside their traditional financial report with ASIC.

For many larger Australian companies, the first reporting cycle began last year from 1 January 2025. With the commencement of the second reporting period in July this year, this article will outline which businesses are bound by the new sustainability reporting obligations and when. It will also outline what information must be included in the mandated sustainability report and valuable tips for how businesses