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Government proposes forcing NZ's top 200 businesses to report on their impact on the climate

The Government wants to introduce a mandatory climate-related financial disclosure regime that could see the top 200 businesses in New Zealand forced to report their impact on climate change. 

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The annual disclosures are part of a new Government policy. Source: 1 NEWS

Climate Change Minister James Shaw said the possible changes would "bring climate risks and resilience into the heart of financial and business decision making". 

"Many large businesses in New Zealand do not currently have a good understanding of how climate change will impact on what they do. 

It would only kick in from at least 2023 if approved by the next Parliament. 

About 200 businesses will need to disclose governance arrangements, risk management and strategies for mitigating climate change impacts yearly. 

"It will ensure the disclosure of climate risk is clear, comprehensive and mainstream," Shaw said.

"If businesses know how climate change will impact them in the future they can change and adopt low carbon strategies.

"Covid-19 has highlighted how important it is that we plan for and manage systemic economic shocks – and there is no greater risk than climate change."

Businesses will need to "comply-or-explain".

It would apply to all registered banks, credit unions and building societies with total assets of more than $1 billion, managers of registered investment schemes with greater than $1 billion in total assets, all equity and debt issuers listed on the NZX, licensed insurers with greater than $1b in total assets and Crown financial institutions with greater than $1b.

From there, the Financial Markets Authority will monitor, report and enforce the rules. 

The 2018 Productivity Commission Low-emissions Economy report recommended introducing the mandatory (comply-or-explain) climate-related financial disclosure system.