29 January 2025

ESG is dead, long live ESG!


GILES RAFFERTY, Media and Financial PR


As Trump 2.0 begins to coalesce, are the requirements for Companies to report on greenhouse gas emissions going up in smoke? A quick review of headlines such as:

could create the impression the multi year efforts, across multiple jurisdictions to introduce mandatory frameworks for climate reporting are at risk of being undone.

On 1 January 2025 Australia joined early adopters[1], The European Union[2], the United Kingdom[3] and New Zealand[4] by introducing mandatory climate disclosure requirements for Companies. Other countries, such as Japan[5] and Canada[6], have well advanced programs to introduce mandatory climate reporting standards in some form.

In Australia the timeline to amending the Corporations Act to introduce mandatory climate-related financial disclosures, as of the first of January 2025, can be traced all the way back to the establishment of the Intergovernmental Panel on Climate Change (IPCC) by the United Nations in 1988,[7] see table 1.

TABLE 1 Development of climate-related financial disclosures in Australia

YearClimate ActionComment
1988Intergovernmental Panel on Climate Change (IPCC)Established by the United Nations to prepare a comprehensive review of Climate Change
1992United Nations Framework Convention on Climate Change (UNFCCC)A treaty to combat dangerous human interference with the climate system – Informed by the IPCC, Australia is a signatory
2015The Paris Agreement, (developed under the auspices of the UNFCCC)Adopted by 196 countries to strengthening the global response to the threat of climate change, Australia is a signatory
2015Task Force on Climate-related Financial Disclosures (TCFD)Established in 2015 by the Financial Stability Board at the request of the G20 finance ministers and central bank governors
2017TCFD published its final recommendationsA voluntary, consistent climate-related financial risk disclosures framework for use by companies
2018Voluntary TCFD reporting initiated by Australian listed companies Australian Securities and Investment Commission (ASIC) recommend a voluntary approach to reporting climate-related risks
2021ISSB established by International Financial Reporting Standards (IFRS) FoundationThe ISSB is to develop a high-quality, comprehensive global baseline of sustainability disclosures for investors and the financial markets
2022Climate Change ActLegislation relating to Australia’s contributions under the Paris Agreement
2023IFRS S1 and S2 standards published by ISSBIFRS S1: General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2: Climate-related disclosures
2023TCFD disbandedTCFD responsibility transferred to the ISSB
2024AASB reporting standards Australian Accounting Standards Board’s AASB S1 and S2, based on ISSB and using IFRS S2 as a baseline, approved
2025Roll out of mandatory AASB S2 reporting in Australia Large businesses to begin preparing annual sustainability reports containing climate-related financial disclosures in the 1st instance

It is certainly the case that Donald Trump appears determined to rescind the U.S. corporate regulator, the SEC’s, Climate Disclosure Rules introduced in 2024. And Shadow Treasurer, Angus Taylor, has been reported as vowing the Liberal/National coalition, will repeal the new Australian laws requiring businesses to disclose their greenhouse gas emissions, if his Party forms government following the election due by  the end of May 2025. The rationale for this position appears to be that to increase the climate related financial disclosure burden and costs in Australia, at time when the new US administration is rolling back similar regulations, will make Australia a less competitive business jurisdiction.

These political declarations of climate reporting roll backs come as passive fund manager, BlackRock, decided to withdraw from the Net Zero Asset Managers (NZAM) initiative on 9 January 2025[8]. Blackrock is the world’s biggest passive fund manager, with A$14 trillion under management, and four days after its withdrawal the NZAM suspended its activities. NZAM had been holding signatory organisations responsible for supporting the goal of net zero greenhouse gas emissions by 2050. Prior to suspending its activities, the NZAM had reported more than 325 asset managers, representing over US$57.5 trillion[9], had made individual net zero commitments. BlackRock explained its withdrawal by saying its membership of NZAM caused confusion about its practices and subjected the firm to legal inquiries. Blackrock also said, however, its active portfolio managers will continue to assess material climate-related risks.

Looking beyond the headlines reveals reports of the death of ESG are an exaggeration. Donald Trump is in the position to issue an Executive Order advising the SEC to consider rescinding its mandatory climate-related financial risk disclosure rules. Trump would be using the same approach that President Biden took to getting the Department of Labour to rescind, and then replace, its ESG legislation in May 2021 under Executive Order 14030[10]. With Trump’s appointee, Paul Atkins, at the helm as SEC chairman, it is likely the new U.S. mandatory climate-related financial risk disclosure rules will be rescinded.

But such changes would be at the federal level. That means companies that operate in the State of California, for instance, will still need to comply with California’s climate disclosure laws[11]. And U.S. Companies that operate in the European Union will still have to comply with the EU’s Corporate Sustainability Reporting Directive (“CSRD”)[12]. In addition, rescinding the new U.S. mandatory climate-related financial risk disclosure rules will not remove the SEC Guidance Regarding Disclosure Related to Climate Changes[13] that has been in place since 2010, which are, admittedly, not particularly prescriptive.

A Company’s decision to publish a Sustainability Report that discloses ESG data is not solely driven by regulations. Financial Markets have identified they have a key role to play in both funding the transition to a carbon neutral future and encouraging voluntary corporate sustainability reporting. In response, Companies have committed to ESG disclosure practices in order to be included as an investment option for funds with mandates that include sustainability requirements and for inclusion in indices that require ESG disclosures from their constituents. In addition, an awareness of the negative economic impact of extreme climate events is also creating an expectation amongst many customers and other stakeholders in Companies that they will be taking action to help to mitigate climate change and be seen to do so.

It is likely that any roll back of Governmental regulations around climate reporting will not remove the other imperatives for Companies to generate sustainability reports, including performance against a standardised set of environmental metrics. At FIRST Advisers we have many years of experience advising on sustainability reporting and have forged a partnership with NetNada to help our clients access actionable tools and insights to make measurable progress towards reducing their carbon footprint.


30 May 2024

Designs on Annual Reporting


IT IS TIME TO THINK ABOUT ANNUAL REPORTS and then to think again. While an Annual Report must include content required by the Corporations Act and the ASX listing rules, that doesn’t mean we should limit our thinking to just meeting that objective. It is right and proper for the compulsory materials, such as the […]

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29 February 2024

PERCEPTION STUDIES SUPERCHARGE INVESTOR RELATIONS


BEN REBBECK, Executive Director IR teams put a lot of work into communicating their company’s investment case, so it is important to assess if this investment case is being understood and valued by investors. One of the best ways to do this is through third-party perception research. Showing that a company’s investment case is being […]

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29 November 2023

Winds of change – AASB draft climate standards


GILES RAFFERTY, Corporate Communications and Media Advisor “The biggest change to corporate reporting in a generation.”, is how the Australian Institute of Company Directors has described the Australian Governments ambitions to make climate-related disclosures mandatory for large businesses and financial institutions. Civil penalties planned to ensure climate reporting compliance The Government’s target is to have […]

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3 November 2023

White Paper on Australia/NZ ESG Reporting Practices in 2023


VICTORIA GEDDES, Investor Relations For the past 3 years FIRST Advisers has been tracking Australian companies preparedness for the task of reporting on their Environmental, Social and Governance (ESG). This was in response to the obvious momentum that was building globally around the impact of climate change as well as growing evidence attributing superior performance […]

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2 November 2023

Same Day Reporting Hits 8 Year High


SALONI SURI, Shareholder Analytics For several years, First Advisers has been tracking trends in Same Day Reporting by ASX300 companies, which we define as releasing an Annual Report and Financial Results on the same day. The practice of providing an Annual Report on the same day as a companies’ results has become a KPI for […]

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30 June 2023

ISSB releases Inaugural Global Sustainability Disclosure Standards


VICTORIA GEDDES, Executive Director On 26 June 2023, the ISSB (International Sustainability Standards Board) issued its inaugural standards – IFRS S1 and IFRS S2 – after 18 months of intensive consultation and research. Over the past five years, sustainability factors have become increasingly mainstream in investment decision making and they are central to how companies […]

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30 March 2023

TCFD’s place in the ESG Continuum


ROWAN CLARKE, Investor Relations As the investment community increasingly uses ESG information, there has been growing pressure for ESG frameworks and standards to evolve. The International Sustainability Standards Board (ISSB) is currently finalising a requirement for companies to report on their climate-related risks and opportunities, with a decision expected in June 2023. The Task Force […]

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1 March 2023

Financial Reporting post COVID


ADITYAN ANIL, Shareholder Analytics A key event in any company’s IR Calendar is the reporting of their financial results. This occurs twice a year and requires all ASX listed companies to publish financial results that cover a six- and twelve-month timeframe. The ASX Listing Rules give companies discretion on when they choose to publish their […]

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29 June 2022

Evaluating Your IR Program


ROWAN CLARKE, Investor Relations As we enter a new financial year, it is worth reflecting on the effectiveness of your Company’s IR program. This was a topic at the 2022 National Investor Relations Institute’s (NIRI) Conference held in Boston. FIRST Advisers attended the conference in June and we summarise some of the key recommendations. Recommendation […]

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29 April 2022

Mastering Virtual Investor Days – Part 2


VICTORIA GEDDES, Executive Director and GILES RAFFERTY, Senior Adviser Corporate Communication Following on from part 1, published in our March 2022 Newsletter, this second part of our overview of Virtual Investor Days looks at the complexities and advantages of managing online events and online presentation skills. Managing Digital Logistics For any Investor Day there are […]

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30 March 2022

Mastering Virtual Investor Days – Part 1


VICTORIA GEDDES, Executive Director In our popular two-part blog on The Do’s and Don’ts of Investor Days, we were working on the not unreasonable assumption that they would be in person events. Over the past two years Covid has ruled out face to face meetings, let alone organizing large events such as AGMs and Investor […]

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28 January 2022

ESG Reporting in 2021


ROWAN CLARKE, Investor Relations At FIRST Advisers, a number of our clients are starting to focus on the task of reporting on their Environmental, Social and Governance (ESG) performance for the first time. This reflects the increased momentum that has been gathering in recent years, particularly in the ASX 300. We first undertook a review […]

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28 October 2021

PERCEPTION STUDIES TO SUPERCHARGE INVESTOR RELATIONS


BEN REBBECK, Founding Director Why you need to understand perceptions of your company The substantial resources, including staffing, technology, printing, advisers and senior management time that most companies devote to investor relations are unfortunately not unlimited. It’s therefore crucial that these scarce resources are utilised as efficiently as possible with the best IR outcomes for […]

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30 April 2021

Proxy Advisors in a time of COVID


GILES RAFFERTY, Corporate Communication and Media Advisor The Coronavirus pandemic continues to ravage the world, we canvassed the three main Proxy Advisory firms operating in Australia Ownership Matters, CGI Glass Lewis and ISS to get a sense of what impact corporate and government responses to the pandemic has had on governance and their voting recommendations. Widening […]

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30 March 2021

How fair is your SPP?


ANNA FUGLESTAD, SHAREHOLDER ENGAGEMENT Over the past year as companies have taken advantage of buoyant equities market and COVID related exemptions to undertake capital raisings, retail shareholders have jumped on the opportunity to increasing their holdings through Share Purchase Plans. FIRST Advisers recently analyzed all Share Purchase Plans that occurred between March 2020 and February […]

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31 January 2021

Fink doubles down on climate


GILES RAFFERTY, Corporate Communication and Media Advisor Restating that climate risk is investment risk, Larry Fink, the Founder, Chairman and CEO of Blackrock, the world’s biggest and arguably most powerful investor, is calling for companies to share their plans for the transition to a net zero economy in his annual letter to CEOs. Mr Fink […]

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30 July 2020

Assessment of Virtual AGMs — Must try harder!


BEN REBBECK, EXECUTIVE DIRECTOR As the repercussions of the COVID pandemic started to impact the corporate sector ASIC, the Australian corporate regulator, following advice and prompting from their foreign counterparts, allowed Australian listed companies to hold fully virtual Annual General Meetings. ASIC’s pathway to enable virtual AGMs, as they were the first to admit, was […]

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28 May 2020

Designs on Annual Reporting


GILES RAFFERTY, Corporate Communications. It is time to think about Annual Reports and then to think again. While an Annual Report must include content required by the Corporations Act and the ASX listing rules,that doesn’t mean we should limit our thinking to just meeting that objective. It is right and proper for the compulsory materials, […]

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28 March 2019

Purpose for the Board


GILES RAFFERTY, Corporate Communications and Media Advisor A listed company’s Purpose is now, very much, a matter for Board consideration. The latest edition of the ASX’s Corporate Governance Principles and Recommendations makes it clear the Board is responsible for linking a company’s Purpose to its strategic goals. Principle 3 states a listed entity should instil a […]

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4 March 2019

Cybersecurity: reported data breaches surge almost 700% in 2018


As we mark the one-year anniversary of the introduction of the Federal Government’s Notifiable Data Breach (NDB) scheme, the headlines focused on cybersecurity breaches seem to be coming thick and fast. The attack in early February 2019 on the Australian Federal Parliament’s computer network, has been identified by Prime Minister Scott Morrison as the work […]

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8 December 2017

FIRST Advisers at AIRA 2017 Annual Conference & Best Practice Investor Relations Awards


FIRST Advisers was an event sponsor at the AIRA 2017 Annual Conference and Best Practice IR Awards held in Sydney in late November. FIRST Advisers contribution included moderating a Crisis management panel discussion on managing breaches to cybersecurity and sponsoring the Award for Best Investor Relations by a Company in the ASX “Mid-cap 100”. Opening […]

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1 August 2017

The Evolving Board Role in Determining Corporate Culture


Philippa Ellis, Governance & Investor Relations Not a day seems to go by without some headline homing in on yet another corporate scandal with its genesis often attributed to a lax or loose corporate culture. In Australia it has most recently focused on the wealth management and life insurances divisions of the major banks. ASIC […]

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