ASIC Enforcement For Sustainability Reporting Will Be Different To Greenwashing

When assessing how to comply with the new reporting obligations, reporting entities should recognise the differences in the enforcement approach that ASIC will take in relation to mandatory climate reporting compared with the approach adopted by it in relation to Greenwashing.

Greenwashing misconduct has focussed on financial services entities which have volunteered to provide statements about their green credentials which have been demonstrated to be misleading and deceptive based on the application of well-established Corporations Act principals.

Under Australia's mandatory climate disclosure regime, relevant entities are required to produce "sustainability reports", which require that climate-related disclosures are reported in the same context as the financial statements and directors report for a relevant year. As a result, climate disclosures will be subject to the existing liability framework in the Corporations Act and the ASIC Act which includes