Treasury reports progress towards 2030 net zero target

Treasury has published results for its Year 2 reporting provisions for Tranche 1 Commonwealth entities in its report, Commonwealth Climate Disclosure 2025–26.

In line with the Commonwealth Climate Disclosure, the federal government’s policy for Commonwealth entities to publicly report on their exposure to climate risks and opportunities, Treasury revealed that the progress for its scope 1 and scope 2 from 2022–23 to 2025–26 towards its APS Net Zero 2030 target was -28.26 per cent.

Further, it reported the use of a total of 226,131.92 kWh of renewable electricity in 2025–26 and a total of 791.65 tonnes of greenhouse gas emissions used in the same period across scopes 1, 2, and 3.

The federal government will continue to roll out its reporting partially, in stages over three years, until 2028–29 and onwards, when it will report on tranches 1, 2 and 3 based on the full climate requirements.

For 2025–26, the government reported on the Year 2 requirements of tranche 1 and the Year 1 requirements of tranche 2.

“Treasury is progressively integrating climate-related risk and opportunity management into its overall risk management process,” it said in its report.

A mandatory reporting regime

This climate disclosure follows the government’s imposition of mandatory climate reporting for large entities starting 1 January 2025.

Finance teams of some of Australia’s major corporations stressed the importance of clarity, strong documentation, and bringing the same framework and governance of financial reporting to climate reporting at CA ANZ’s sustainability conference 2026 in October.

“One of the themes that have come up already in this conversation is that the reporting is just the end of a process that already exists in our business,” QBE head of group statutory reporting and accounting policy Rachel Poo said.

“In order to deliver the mandatory reporting, we had to make sure that we were able to articulate why we held that view, bring together all the activities that already existed across the business, and actually explicitly consider and document all of the assumptions, uncertainties, and limitations that existed around that,” Poo said.

Steady improvements

The switch to mandatory climate reporting has led to an increased quality in this reporting, ASIC noted in September.

According to ASIC’s findings published in Report 839, ASIC’s review of sustainability reports lodged for 31 December 2025, the commission found that of the 40 sustainability reports reviewed, 95 per cent identified at least one climate-related risk or opportunity that could reasonably be expected to affect the entity’s prospects over the short, medium or long term, with only two not identifying any climate-related risks or opportunities.

This is in contrast to sustainability consulting company Environmental Resources Management’s (ERM) analysis in May, of 33 disclosures, which found that fewer than a third of the disclosures had listed any quantified financial impact on their earnings, balance sheet or cash flows, and most had allocated little or no capital to address the significant climate exposures they disclosed.

Further, just one month prior, Mallesons found in its report, Mandatory Sustainability Reporting in Practice, that among 23 group 1 reporting entities, two in five had no climate transition plan.

The results for the first round of reports were a “mixed bag”, Grant Thornton found in March.

“[Some] big companies have released really quite succinct reports, and then some smaller companies have released quite long and complicated reports. So there's quite a bit of variation in terms of the understanding of the requirements,” Grant Thornton partner John Askham told Accounting Times.

“As more people consider environmental sustainability when making financial decisions, climate disclosure will continue to grow in importance,” ASIC commissioner Kate O’Rourke said in January 2025.