The ESG and sustainability landscape for Australian businesses is undergoing a transformation, with new regulatory measures set to reshape the way larger organisations report their environmental and social impacts. Expected to take effect on the 1st of July 2024 is the Australian Treasury’s phased approach for mandatory sustainability reporting for larger enterprises. It aims to align ESG reporting practices with global sustainability standards, emphasising the need for business to comprehensively disclose their carbon footprint, social responsibility initiatives, and strategies for mitigating environmental risks. With the financial year-end approaching, organisations must gear up to embrace these changes and adapt their reporting frameworks accordingly.
Australian businesses are also preparing for another crucial aspect of ESG transparency – workplace gender equality. The Workplace Gender Equality Agency pay gap reporting emphasises the need for organisations to address gender disparities within their workforces. Beyond being a compliance requirement for organisations with over 100 employees, the pay gap reporting may be a catalyst for businesses to evaluate their and improve their internal policies, promoting an environment where diversity and equality are not just ideas but an integral part of sustainable and responsible business practices.
Adding to the complexity, Australian businesses are also bracing for the impact of changes to the European Union’s (EU) International Sustainability Standards Board (ISSB) disclosures. The ISSB’s influence is expanding beyond EU borders, requiring Australian companies to align their reporting practices with evolving global standards. This move is in line with the growing recognition that sustainability is not merely a regional concern but a shared responsibility that transcends boarders. As we inch closer to the 1st of July, organisations are urged to stay informed about these evolving EU standards and make the necessary adjustments to their reporting mechanisms.
As the clock ticks down to the implementation dates, collaboration and information sharing within a business and within the business community is becoming paramount. Larger organisations in particular need to proactively engage with stakeholders including investors, customers, regulatory bodies, and their suppliers to communicate their ESG and sustainability efforts to ensure a smooth transition. The impact isn’t solely confined to larger organisations, it cascades down the supply chain, effecting businesses at every tier.
These new regulatory measures demand a heightened level of accountability for all entities within a large organisation’s supply network. In 2024, businesses in the supply chain will find themselves under increased scrutiny to align their reporting standards mandated for their larger counterparts. This means that that not only does the primary organisation needs to enhance their sustainability practices, but they also need to foster a collaborative and sustainable ethos throughout their entire supply chain. These changes will require a collective effort, encouraging businesses to work together. These changes underscore the interconnectivity of sustainability, emphasising that the journey towards a greener future must involve collaboration within the business community.
Not sure where to start? NettZero creates tailored ESG reports for organisations looking to capture current performance, set goals, and measure improvements year on year. Visit our website or contact us to learn more.