The Insider/
How Treasury’s new reform proposal could lower the cost of climate reporting

Whether you’re already reporting under AASB S2, or gearing up to start, Treasury has just opened a window that could change what compliance costs you over the next few years.

Group 1 entities have completed their first year of mandatory climate disclosure, and that real-world experience is what has prompted a review on the efficiency of climate-related financial disclosures by the Treasury.

Nothing changes for your FY 26/27 reporting, but there’s good reason to pay attention to where this is heading.

What the changes actually are

The Treasury’s consultation paper put forward three main reforms.

The first looks at assurance settings, specifically whether the legislated move from limited assurance to full reasonable assurance by 2030 should go ahead as planned, be delayed to 2035, or apply only to mature metrics like Scope 1 and 2 emissions while Scope 3 stays under limited assurance.

The second is about clearer guidance, not new rules, on applying the proportionality language already built into AASB S2. Phrases like “reasonable and supportable information… without undue cost or effort” have proven difficult to apply in practice.

The third looks at setting clearer boundaries on what data reporting entities can reasonably request from their value chains, with an eye on the burden this places on smaller suppliers

Two smaller ideas are also on the table. One would align National Greenhouse and Energy Reporting periods with financial year reporting (as they currently do not match). The other would review auditor experience requirements, so sustainability assurance work counts toward Registered Company Auditor registration.

All of this sits apart from the 2026-27 Federal Budget’s proposed threshold change where the Government has announced its intention to raise the thresholds. However, it has not yet been legislated with its timing to be confirmed through the broader regulatory reform package.         

What stays the same for you

Nothing about your current reporting obligations will change from this consultation. If you’re preparing FY 26/27 disclosures, proceed as planned.

It is also worth knowing what’s permanently off the table. Treasury has been explicit that Scope 3 reporting requirements and the population of entities required to report won’t be revisited through this process. This is about how the regime works in practice, not whether it exists.

What could change for you and what it affects

Where this consultation gets interesting depends on where you sit.

If you’re a Group 1 or 2 reporter, the assurance proposal is the one to watch most closely. Whichever option the Treasury lands on will shape how much of your reporting program needs to be audit-ready over the next few years, and how soon that bar rises.

If your team has been finding the proportionality provisions hard to apply with confidence, this consultation is aimed squarely at you. Clearer guidance won’t change what you’re required to do, but it should make it easier to defend the judgement calls you’re already making.

And if you sit anywhere in a reporting entity’s value chain, whether you’re the one asking for data or the SME on the receiving end, this is the proposal most likely to change your day-to-day. Fewer, better-defined requests could mean real time and cost saved on both sides.

What you should do about it

None of this requires you to change anything today.

But if any of these proposals would meaningfully affect your reporting costs, this is genuinely the moment to say so. Treasury has said stakeholder evidence  will directly inform the Policy Impact Analysis behind any eventual changes.

Submissions close Friday 2 October 2026, through Treasury’s consultation hub. If you’ve been tracking the practical cost of your reporting program this year, that evidence is worth putting in front of them now, while these settings are still being decided rather than after.

Our view

None of these three proposals would weaken the regime. Each is aimed squarely at cost, not credibility, which is the right test for reform this early in implementation.

The assurance question is the one to watch most closely. Where that lands by 2030 will shape how much of your reporting program needs to be audit-ready, not just accurate.

How ReGen can help

Staying close to regulatory movement like this is part of keeping a sustainability strategy genuinely current, not just compliant with the rules as they stood when it was written. ReGen Strategic helps clients work out which of these proposed changes matter most, and what they could mean for compliance planning over the next few years. It’s worth noting that the value-chain data burden this consultation is trying to ease is one we already help clients manage directly. We work with eco-shaper, a climate intelligence platform designed to help organisations track, manage, and audit carbon emissions across their operations and supply chains.