Download submission here, for RIAA’s full submission and responses to consultation questions.

RIAA broadly supports the proposed strategic direction of greater international alignment through a New Zealand climate reporting standard based on IFRS S2, provided this is implemented in a way that preserves the quality, comparability and decision-usefulness of climate disclosures for investors.

RIAA’s response has been informed by previous RIAA submissions on climate-related disclosures, international alignment and sustainability reporting, and by engagement with members of RIAA’s Aotearoa Collaborative Working Group (ACWG), which is made up of some of New Zealand’s largest investment firms. We are grateful for the strong engagement by RIAA members who contributed to the development of this submission.

This submission represents RIAA’s policy position. While ACWG engagement has provided important input and helped identify member perspectives and practical considerations, the submission should not be read as a formal consensus view of the ACWG or of RIAA’s broader membership.

RIAA encourages XRB to use the roadmap to support a clear and proportionate transition to an internationally aligned regime, while ensuring that any changes do not reduce the usefulness of climate information for investors. This includes maintaining a focus on robust disclosure quality, practical implementation support and appropriate trans-Tasman harmonisation. RIAA also considers that the roadmap should acknowledge the importance of market coverage to the regime’s effectiveness. Although decisions on the scope of climate reporting entities sit outside XRB’s remit, the roadmap should identify this as an important dependency and signpost the relevant agencies responsible for those settings.

Any reforms or amendments to the regime that have the effect of reducing the scope, relevance and quality of climate-related information available to inform investment decisions will be counter-productive to the interests of investors, New Zealand’s economy and New Zealand’s ability to attract investment.

General comments

Navigating intensifying climate risks require decision-useful information

Climate change is increasing portfolio, business and system-wide financial risks

Aotearoa New Zealand faces increasing exposure to both the physical and economic impacts of climate change:

• He Pou a Rangi Climate Change Commission’s 2026 National Climate Change Risk Assessment identifies significant climate-related risks to Aotearoa New Zealand’s economy, society, environment and ecology.
• The 2026 progress report on the National Adaptation Plan notes exposure and vulnerability to flooding, landslides, extreme heat, coastal flooding and insurance availability as nationally relevant adaptation issues.
• The Ministry for the Environment’s National Adaptation Framework states that climate change is making floods and storms more frequent and intense and that information sharing, investment in risk reduction and cost-sharing are core pillars of New Zealand’s adaptation response.

More frequent and severe weather events, changing climate conditions and the costs associated with the transition to a lower-emissions economy are expected to affect communities, infrastructure, businesses and investment portfolios across the economy. New Zealand's climate objectives and adaptation priorities will require significant public and private investment over coming decades. As these risks become more material, high-quality climate-related information will become increasingly important for investors, companies and policymakers seeking to understand exposures, assess resilience and allocate capital effectively. Transparent and comparable disclosures can help market participants identify risks and opportunities, support investment in resilience and transition activities, and improve the overall efficiency of capital allocation.

Climate disclosures help investors assess risk, allocate capital and support resilience

Climate-related disclosures provide value at both the individual entity level and across the broader financial system. For investors, disclosures improve understanding of how climate-related risks and opportunities may affect business models, strategy, financial performance and long-term value creation. Consistent and comparable information supports more informed investment decisions and strengthens stewardship and engagement activities.

At a market-wide level, climate disclosures contribute to greater transparency regarding the distribution of climate-related risks and opportunities across the economy. This information can assist regulators, policymakers and market participants to better understand systemic vulnerabilities, identify emerging risks and support a more orderly transition to a resilient, low-emissions economy. Climate reporting therefore serves not only the needs of individual investors and reporting entities, but also broader public policy objectives relating to economic resilience, adaptation and sustainable growth.

The information generated through the climate reporting regime is also important for mobilising private capital towards climate mitigation and adaptation activities. As identified by the Ministry for the Environment’s first emissions reduction plan, funding and finance are key enablers of the transition, including mobilising private capital, aligning investment with climate objectives and supporting high-quality investment decisions. Investors require reliable and comparable information to assess climate-related risks and opportunities, evaluate transition readiness and direct capital towards investments that support long-term economic resilience. Maintaining a robust climate disclosure framework can therefore help support the flow of private investment needed to meet New Zealand's climate and resilience objectives.

Strengthening entity-level climate risk preparedness supports system-wide resilience

Climate reporting helps strengthen resilience within reporting entities by encouraging more systematic identification, assessment and management of climate-related risks and opportunities. Over time, the processes, governance arrangements and strategic planning developed to meet disclosure requirements can improve organisational preparedness for both physical and transition-related risks.

In fact, this is a key objective of climate-related disclosures:

• XRB notes that reporting supports better decision-making and encourages entities to consider strategic choices in light of climate risks and opportunities, including the transition to a low-emissions future.
• The Ministry for the Environment explains that mandatory climate-related disclosures are intended to ensure climate change is routinely considered in business, investment, lending and insurance decisions and to support more efficient capital allocation and a smoother transition to a low-emissions economy.

These benefits extend beyond individual entities. As more organisations develop a clearer understanding of their climate exposures and resilience strategies, investors and other stakeholders gain better visibility of risks across the market. This contributes to more informed capital allocation, strengthens market discipline and supports the overall resilience of the financial system. While disclosure alone will not reduce climate risk, it provides important information that can help businesses, investors and policymakers respond more effectively to the challenges posed by climate change.

Better climate information supports investment decisions, but capital flows need enabling policy

Climate-related disclosures play an important role in improving the availability, consistency and comparability of information available to investors. This information supports the assessment of climate-related risks and opportunities, strengthens stewardship and engagement activities, and helps market participants allocate capital more efficiently. However, climate reporting alone will not be sufficient to mobilise the scale of private investment required to support New Zealand's climate mitigation and adaptation objectives.

Investment decisions are influenced by a broader set of policy, regulatory and market factors. These include the existence of credible transition pathways, investment-ready projects, supporting policy frameworks, carbon pricing signals, infrastructure planning, adaptation strategies and regulatory certainty. Climate reporting can help identify investment needs and opportunities, but additional policy measures are often required to translate information into investment outcomes. The Survey of Aotearoa Investors: Climate Policies & Actions 2026 (2026 AoNZ Investor Survey) found that only 21% of investors considered barriers to climate investing to have improved over the prior 12 months, while 43% considered them to have worsened. The barrier to climate solutions investment which was most commonly identified was a lack of opportunities with appropriate risk-return objectives; policy or regulatory uncertainty, fiduciary duty concerns, and a lack of clarity and/or government incentives were also frequently cited. (pp. 18–19.)

RIAA therefore encourages the final roadmap to acknowledge that the success of the climate reporting regime will be dependent on a number of different government bodies and priorities. While the XRB will be central due to the substance of the standards, the effectiveness of the regime will also depend on complementary actions across government and regulatory agencies, such as MBIE in relation to reporting legislation and scope and FMA in relation to regulation and enforcement of the reporting regime.

Market coverage is critical to decision-useful climate reporting

From an investor perspective, the usefulness of climate disclosures depends not only on the quality of information disclosed by individual entities, but also on the breadth of coverage across the market. Investors typically construct portfolios, assess sectors and allocate capital across multiple entities rather than evaluating organisations in isolation. The value of climate-related disclosures is therefore significantly enhanced when information is available across a meaningful proportion of the market and can be compared consistently between entities.

Broad market coverage improves transparency regarding the distribution of climate-related risks and opportunities across the economy, supports benchmarking and peer comparison, and enables investors to identify leaders, laggards and areas of emerging risk. It also helps regulators and policymakers develop a more complete understanding of systemic climate-related risks and the resilience of the financial system.

Conversely, where climate reporting applies to only a limited subset of entities, investors may face information gaps that reduce comparability and make it more difficult to assess risks and opportunities consistently across portfolios. Improvements in reporting quality are therefore most valuable when accompanied by sufficient market coverage to ensure that climate-related information remains meaningful, comparable and decision-useful at both the entity and system levels.

For this reason, RIAA considers that the roadmap should recognise market coverage as an important factor influencing the long-term effectiveness of New Zealand's climate reporting regime. While decisions regarding the scope of reporting entities sit outside XRB's remit, the roadmap should acknowledge this dependency and clearly signpost the relevant policy and regulatory processes responsible for determining market coverage.

Mutual recognition can support efficient, interoperable climate reporting

RIAA also encourages continued consideration of mutual recognition between Australia and New Zealand as a mechanism to reduce duplicative reporting where equivalent investor information is provided. Mutual recognition arrangements have the potential to support the roadmap's objectives of international alignment and trans-Tasman interoperability, while helping preserve the usefulness of information available to investors across both markets. MBIE has described the Closer Economic Relations and Trans-Tasman Mutual Recognition arrangements as supporting regulatory co-operation, lower business costs and a more seamless trans-Tasman market.

While decisions regarding mutual recognition sit outside the XRB, RIAA considers that the roadmap should acknowledge the importance of regulatory interoperability and identify mutual recognition as a complementary mechanism that could support the efficient operation of an internationally aligned climate reporting regime.

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