Directors of Australian corporations need to have strategies to appropriately consider and disclose climate risks if they are to comply with their directors’ duties. This was one of the findings of a legal opinion commissioned by the Centre for Policy Development (CPD) in October 20161, and subsequently endorsed by statements of Australian Securities & Investments Commission (ASIC).
There has been a flurry of updated guidance from regulators in 2019, so it might be time for a refresher:
What is climate risk and why does it matter?
Climate change risk is often described in terms of:
- risks related to the physical impacts of climate change (such as extreme weather events); or
- risks related to the transition to a lower-carbon economy (such as policy, legal, technology, and market changes).2