An Essential Components Checklist for Preparing your Company’s First Sustainability Report under the Mandatory Climate-related Financial Disclosures (AASB 2)

Identifies and describes the company's key climate commitments, including Net Zero targets, supporting the Paris Agreement goals and applicable decarbonisation pathways (e.g. at a sector and/or national level).

Cornerstone document for the development of short (1–3 years), medium (3–10 years) and long-term (towards 2050) strategy in relation to climate-related risks and opportunities. Time-based strategic planning is broadly framed around:

• Short term — operational compliance, acute physical risks, reputational exposure.
• Medium term — transition risks/opportunities, 2030 emissions targets, major capital allocation decisions.
• Long term — structural industry shifts, systemic risks, net zero 2050 pathways, resilience under climate scenarios.

• Preparation of bespoke Policy from scratch with full internal consultation and draft review process.
• Gaps analysis of existing Policy/ies to confirm alignment with current good practice approaches.

Describes how different key types of climate risk are formally integrated into broader, company-wide Enterprise Risk Management (ERM) framework(s).

Describes thresholds and processes for assessment of physical risks (floods, heat, supply chain disruptions) and transition risks (carbon pricing, regulation, technology shifts).

• Preparation of substantive Policy updates into existing RMP / ERM frameworks with full internal consultation and draft review process.
• Gaps analysis of existing Policy/ies to confirm alignment with current good practice approaches.

Describes how different key types of climate risk are formally integrated into broader, company-wide procurement and supplier engagement policies. Common key approaches may include:

• ESG and climate clauses in procurement contracts.
• Supplier Code of Conduct requiring disclosure of emissions and energy practices.
• Supply chain engagement policies, including capacity building and collaboration initiatives with key suppliers on climate issues and co-sharing of carbon calculators for select suppliers.

• Preparation of substantive Policy updates to integrate into existing procurement and supplier engagement frameworks with full internal consultation and draft review process.
• Gaps analysis of existing Policy/ies to confirm alignment with current good practice approaches.

Describes how different key types of climate risk and opportunity are formally integrated into broader investment decision making (including via externally managed portfolios). More traditional exclusionary approaches focus on screening investments to ensure they:

• Do not support major new coal, oil or gas projects.
• Prioritise renewable energy initiatives.
• Prioritise companies with a demonstrated track record of a comprehensive climate response framework.

• Preparation of Policy from scratch, or substantively update existing investment policy, with full internal consultation and draft review process.
• Gaps analysis of existing Policy/ies to confirm alignment with current good practice approaches.

With a more operational focus, this generally sits below the Climate Change and/or Net Zero Policy. Some more common operational emission reduction initiatives may include:

• All office spaces to achieve a 6-Star NABERS Energy rating (or practical equivalent) by 2030.
• 100% of staff vehicle fleet to be fully electric or new-generation hybrid by a target date.
• Full carbon-offsetting for all business-related air travel by staff.

• Preparation of Policy from scratch, or substantively update existing operational energy policy, with full internal consultation and draft review process.
• Gaps analysis of existing Policy/ies to confirm alignment with current good practice approaches.

• Executive KPIs linked to climate metrics (emissions reduction, renewable energy uptake, ESG ratings).
• Participation and development of ESG-based initiatives integrated into performance pay.

Provide an overview / market scan on publicly reported trends in integration of ESG-related KPIs in staff remuneration and performance on a sector-by-sector and/or organisation-level basis.

Annually updated climate scenario analysis to test the company's business model and strategy against a range of plausible future climate pathways, rather than relying on a single forecast.

Key parameters for stress-testing include current (and significant changes in) climate, policy, and market conditions.

Input and examination of key data and use of proprietary supply-chain technology to perform scenario-based climate resilience analysis.

A customised dashboard for the calculation and monitoring of Scope 1, 2 and 3 emissions using the company's actual procurement data.

Fair Supply dashboard subscription for calculation of Scope 1, 2 and 3 emissions and other relevant climate metrics.

Actively addressing climate issues through a variety of supplier due diligence and engagement activities with key suppliers and external stakeholders.

• Integrating subject matter expertise with individual automated and AI-assisted supplier due diligence via Fair Supply's Analyst platform.
• Planning and assistance with conducting key supplier engagement activities, including data gathering initiatives and collaborative activities where key suppliers' Scope 1, 2 and/or 3 carbon footprint is calculated.

Keep up to date with the latest national and global decarbonisation trends (renewables, hydrogen, sustainable finance, low-carbon consumer products). Often the most practical insights are gained through industry benchmarking, rather than broader national and international trend tracking.

Preparation of bespoke industry benchmarking reports, which can be integrated with individual company due diligence or otherwise customised to provide market scan information most relevant to the company's specific operating context.

Annually updated climate scenario analysis to test the company's business model and strategy against a range of plausible future climate pathways, rather than relying on a single forecast.

Key parameters for stress-testing include current (and significant changes in) climate, policy, and market conditions.

Input and examination of key data and use of proprietary supply-chain technology to perform scenario-based climate resilience analysis.

A customised dashboard for the calculation and monitoring of Scope 1, 2 and 3 emissions using the company's actual procurement data.

Fair Supply dashboard subscription for calculation of Scope 1, 2 and 3 emissions and other relevant climate metrics.

Actively addressing climate issues through a variety of supplier due diligence and engagement activities with key suppliers and external stakeholders.

• Integrating subject matter expertise with individual automated and AI-assisted supplier due diligence via Fair Supply's Analyst platform.
• Planning and assistance with conducting key supplier engagement activities, including data gathering initiatives and collaborative activities where key suppliers' Scope 1, 2 and/or 3 carbon footprint is calculated.

Keep up to date with the latest national and global decarbonisation trends (renewables, hydrogen, sustainable finance, low-carbon consumer products). Often the most practical insights are gained through industry benchmarking, rather than broader national and international trend tracking.

Preparation of bespoke industry benchmarking reports, which can be integrated with individual company due diligence or otherwise customised to provide market scan information most relevant to the company's specific operating context.

• Depicting trajectories for relevant minerals / ores / resources under different carbon prices (e.g. iron ore, copper, and coal).
• Stress-testing asset values and revenue.
• Carbon price sensitivity.
• Estimated impact of transition on cost base and capital projects.

• Revenue modelling for LNG exports under multiple demand pathways.
• Quantifies electricity demand changes and models effect of carbon policy on margins.
• Stress-testing asset values and revenue.
• Estimated impact of transition on cost base and capital projects.

• Stress tests (quantified estimates of potential credit risks) of mortgages, agricultural, mining and/or energy sector loan books under flooding, natural disaster and carbon price scenarios; models portfolio exposure shifts.
• Uses accepted climate pathways to estimate sectoral credit losses and financing impacts.
• Climate-adjusted probability of default and loss-given-default models applied to loan portfolios.
• Expected Internal Rate of Return shifts for renewable compared to fossil fuel-based / carbon-intensive projects.

• Scenario-based modelling of commodity price shocks on procurement costs; energy cost modelling.
• Quantifies Scope 1 & 2 emissions reduction costs and stress-tests of key supply chain costs under high carbon prices.
• Capital investment case studies modelled against carbon pricing and energy cost projections.

• Financial modelling of building valuation and rental yields under different NABERS energy ratings.
• Quantitative modelling of construction costs under transition scenarios; valuation analysis for long-term property assets.
• Valuation sensitivity testing for commercial property under rising insurance and carbon costs.