Download the full submission here.

RIAA thanks the Financial Reporting Council (FRC) for the opportunity to comment on the draft determination that will establish the standard-setting boards under External Reporting Australia (ERA).

RIAA has supported the establishment of External Reporting Australia (ERA) throughout the consultation and legislative process. We continue to support the reform’s intent and overall architecture, including dedicated boards for accounting, auditing and assurance, and sustainability standards within a coordinated institutional framework. This structure provides an opportunity to improve the coherence and responsiveness of Australia’s financial reporting system and support consistent development of financial and sustainability reporting standards.

RIAA broadly supports the draft determination. RIAA members are significant users of financial and sustainability information for investment, stewardship and risk management, while some are also subject to reporting requirements.

In finalising the determination, we encourage the FRC to ensure that:

• the boards’ due process and consultation obligations support genuine, timely and transparent engagement with investors and other affected stakeholders;
• the boards are expressly able to issue non-mandatory guidance and educational materials to be able to engage with and respond to emerging issues;
• the boards maintain active engagement with international standard-setting processes while being able to make any necessary, fit-for-purpose modifications for the Australian context;
• periodic reviews, including post-implementation reviews, consider both the costs of reporting requirements and the value of the resulting information;
• the boards consider implementation timing, transition arrangements, market readiness and implementation support when developing new standards or significant amendments;
• ERA and its boards are adequately resourced to undertake high-quality standard setting, stakeholder engagement, research and international participation; and
• the respective roles and responsibilities of the boards, including where sustainability reporting intersects with other standards, are clear and coherent.

RIAA’s response is informed by its previous submissions on the design and establishment of ERA, including submissions to Australian Treasury on the proposed financial reporting architecture and the draft legislation, the Economics Legislation Committee on the Treasury Laws Amendment (Financial Reporting System Reform) Bill 2026 and the Productivity Commission on business reporting requirements. This submission focuses on matters relevant to sustainability standards.

Summary of recommendations

Recommendation 1: Finalise the draft determination broadly as proposed, including the establishment of dedicated accounting, auditing and assurance, and sustainability standard-setting boards within a coordinated ERA framework.

Recommendation 2: Ensure the due process framework requires genuine, timely and transparent stakeholder consultation, including meaningful engagement with investors and other users of financial and sustainability information.

Recommendation 3: Ensure the boards are expressly able to engage with and issue non-mandatory guidance and educational materials, while clearly distinguishing such guidance from mandatory requirements.

Recommendation 4: Maintain alignment with credible international standards where this supports comparability and reduces unnecessary duplication, while supporting effective trans-Tasman coordination, and ensuring that any Australian modifications are necessary, transparent, fit for purpose and informed by the needs of investors and other users.

Recommendation 5: Ensure periodic reviews, including post-implementation reviews, assess both the costs of reporting requirements and the value of the resulting information, including whether it is accessible, comparable and decision-useful for investors and other intended users.

Recommendation 6: Require boards to consider timing, transition arrangements, market readiness and implementation support when developing new standards or significant amendments, and to explain publicly the basis for proposed effective dates and transition provisions

Recommendation 7: Ensure ERA and its standard-setting boards are adequately resourced to undertake high-quality standard setting, stakeholder consultation, research, implementation support and international engagement.

Recommendation 8: Ensure clear roles and effective coordination between the boards on matters that cross accounting, sustainability, auditing and assurance responsibilities, supported by coherent work programs.

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