Page 5 - Chamber Voice Magazine Summer 2023

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ESG (ENVIRONMENTAL, SOCIAL AND

GOVERNANCE) DISCLOSURE – ON ITS WAY

Last month, .In November, the Chamber hosted
a lunch event on the increasingly relevant topic
of ESG (Environmental, Social and Governance)
disclosure. For this discussion, we were
privileged to be joined by Katie Beith, the Head
of ESG at Forsyth Barr, one of New Zealand’s
leading investment advisory and fund
management companies.

The lunch coincided with the opening of
Forsyth Barr’s Marlborough office, the
company’s 25th office across Aotearoa New While the vast majority of Marlborough
Zealand. In her presentation, Katie took around businesses do not fall into any of these categories,
25 Chamber members and local business they will, over time, be affected by several aspects
representatives through some of the emerging of the Standards. The first of these is the fact that
trends in New Zealand’s sustainability and ESG companies identified above will, from the end of
disclosure landscape. 2024, be required to calculate and disclose
climate risks and mitigation action in their
In terms of mandatory ESG disclosure, the first respective supply chains (generally known as
can off the rank is the Aotearoa New Zealand Scope Three emissions). Secondly, the Climate
Climate Standards[1], developed by the New Standards will, over time, require financial
Zealand External Reporting Board (XRB) over institutions to report on financed emissions, in
the past several years. These Standards provide other words, emissions arising from the activities
the regulatory framework for mandatory they finance, as opposed to only emissions arising
reporting on climate risks and mitigation from their operations. Finally, as part of the
actions, in line with international principles as assurance requirements for climate-disclosing
defined by the Taskforce on Climate-Related entities, small suppliers or service providers might
Financial Disclosure (TCFD)[2]. The Standards be included in these assurance activities.
were issued in December 2022, and reporting
will commence from the end of 2023. These two factors mean that small businesses
The Climate Standards apply to: that are suppliers or service providers to large
listed companies will, in the future, be required to
·Large listed companies with a market disclose their emissions to these clients. It also
capitalisation of more than $60 million; means that continued access for small businesses
·Large licensed insurers, registered banks, to financial and insurance services will depend on
credit unions, building societies and their ability to calculate and mitigate their
managers of investment schemes with more emissions.
than $1 billion in assets; and
·Certain Crown financial institutions.

From October 2024, the climate disclosures of
these entities will need to be audited or assured
by independent third parties.

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