Practice area
Climate, ESG & Sustainability ReportingClimate, ESG and sustainability disclosure
Sustainability reporting is a statutory question first: confirm who must report and which instrument applies. Software can build a gap list against the lawyer's headings; it cannot decide whether an entity is in the regime.
Key facts
- Tasks covered
- 16
- Tasks with a step-by-step checklist
- 4
- Local differences
- 2 jurisdictions where this area changes
Jurisdiction
Tasks
GreenLawyer reviewYellowClose supervisionRedLawyer-led
| Task | How AI is used | Human involvement | What the lawyer must review |
|---|---|---|---|
| Decide whether the entity must prepare a climate disclosure | Extract the entity's name, the financial year, revenue bands the client has supplied, and group structure into a fact sheet for the threshold question. | RedLawyer-led |
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| Decide whether the entity must prepare a climate disclosure | Extract the entity’s name, the financial year, revenue bands the client has supplied, and group structure into a fact sheet for the threshold question. | RedLawyer-led |
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| Decide which US climate or ESG disclosure instrument actually applies | From the entity description, list possible federal securities, state and FTC green-claims sources for the lawyer to open. | RedLawyer-led |
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| Decide whether the entity is a New Zealand climate reporting entity under the FMCA | Extract entity type, size facts and NZX listing status from the file. | RedLawyer-led |
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| Build a climate-disclosure gap list from the data room | Map documents in a permitted data room to the climate-disclosure headings the lawyer has listed, and mark headings with no document. | YellowClose supervision |
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| Build an AASB S2 gap list from the data room | Map documents in a permitted data room to the AASB S2 headings the lawyer has listed, and mark headings with no document. | YellowClose supervision |
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| Assemble a modern slavery statement from last year’s statement and the supplier list | Draft a statement skeleton from the entity’s previous statement and a supplier list the client has provided, marking anything new. | YellowClose supervision |
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| Collect environmental marketing claims and the evidence for them | Extract environmental claims from the web pages or deck the lawyer has identified, and list the evidence the client holds beside each claim. | RedLawyer-led |
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| Draft a climate-disclosure narrative from the gap list and the source papers | Produce a first-draft governance, strategy, risk and metrics narrative from the papers mapped to the headings, marking every sentence that has no source. | YellowClose supervision |
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| Build a board-oversight evidence table for the climate disclosure | From minutes, charters and papers, list climate items the board or committee actually considered, with dates and gaps against the governance heading. | YellowClose supervision |
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| Map transition-relief and Scope 3 gaps against the reporting-year plan | From the standard headings the lawyer has listed, mark which disclosures the entity proposes to defer, the legal basis, and when the gap closes. | YellowClose supervision |
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| Check the sustainability report against the statutory contents list | Draft a mapping table that pairs each requirement in the lawyer-approved checklist with the paragraph of the draft sustainability report that addresses it, and list requirements with no matching paragraph or answered only by a cross-reference. | GreenLawyer review | Confirm the requirement list is current for the entity's reporting year and cohort, decide whether each matched paragraph actually discharges the requirement, and resolve every item marked as covered only by cross-reference. |
| Assemble the reasonable-steps record behind the directors' declaration | Index the papers the lawyer selects against each element of the declaration, showing where each item sits and flagging elements with no supporting record. Do not write the declaration, any part of it, or any statement that the steps taken were reasonable. | RedLawyer-led | The directors form and express the opinion. The lawyer decides which element each record supports, whether the record is sufficient, and what further enquiry is needed before the declaration is signed. |
| Build the scenario-analysis record for the climate statements | Draft a record of the scenarios used, their stated temperature reference, the inputs, assumptions, time horizons and approvals, taken from the entity's own working papers, and list anything missing against the two mandated scenarios the lawyer supplies. | GreenLawyer review | Confirm the scenarios used are referable to subparagraphs 3(a)(i) and 3(a)(ii) of the Climate Change Act 2022, check that the recorded assumptions match the analysis actually performed, and make sure the record is not used as the disclosure itself. |
| Assemble the assurance evidence pack and response log for the sustainability report | Draft an index that pairs each request from the assurance provider with the documents supplied, and keep a log of the response, the owner, the date sent and what remains outstanding. | GreenLawyer review | Confirm which level of assurance applies to the entity's reporting year under ASSA 5010, check that nothing privileged or outside the engagement scope has been included, and settle what is actually said in response to each request. Note that information reported to the Clean Energy Regulator is assured under a version of ASAE 3000 rather than ASSA 5000. |
| Reconcile the climate-statement emissions figures to the NGER report | Pull the disclosed and NGER-reported figures into a reconciliation schedule, calculate the differences, and work with the lawyer on the explanation for each, keeping every figure traceable to its source document. | YellowClose supervision | Check the reporting boundary and consolidation basis behind each figure, decide whether a difference is a genuine basis difference or an error, and approve every explanation before any of it is disclosed or given to the assurance provider. |
| Build the safeguard-mechanism obligation calendar and surrender position | Draft a facility-by-facility calendar and position sheet from the baseline determinations, the NGER report and the unit account statements, showing the net position and the registration, reporting, surrender and compliance dates that apply to each facility. | YellowClose supervision | Confirm the baseline determination and the responsible emitter for each facility, calculate the net-emissions position independently, and check every date against the current scheme rules before any surrender is actioned. |
| Build the supplier risk and remediation record behind the modern slavery statement | Assemble the register from questionnaires, audit reports and contract records, and work with the lawyer on the risk rating and the description of each action taken, keeping every entry sourced to the document it came from. | YellowClose supervision | Set the risk criteria, decide each rating, and confirm that what the register says about remediation and effectiveness is supported by what the entity actually did, before any of it is used in a published statement. |
| Build the protected-statement register for the sustainability report | Draft a register that tags each statement in the draft against the protected-statement categories the lawyer supplies — forward-looking climate statements, and statements about scope 3 emissions, scenario analysis or a transition plan — and records the modified liability period for each category. | YellowClose supervision | Confirm the entity's financial year start against the protection windows, decide whether each tagged statement is in fact within a protected category and made for the purpose the provision requires, and check that untagged statements have been considered rather than missed. |
| Compare the climate statements with the entity's other public statements | Extract comparable statements from the draft climate statements and from the other documents the lawyer supplies, pair them by subject, and draft a schedule of the differences with an exact reference for each side. | GreenLawyer review | Decide which differences matter, whether any amounts to a misleading representation, and which document is corrected. The lawyer judges materiality; the tool does not. |
Firm-wide obligations
| Obligation | What it covers |
|---|---|
| Trust accounting & handling client money | Checks that apply across files. |
| Costs, billing & litigation funding | Checks that apply across files. |
| Client-facing & access-to-justice AI tools | Checks that apply across files. |
| Incoming evidence — deepfakes & synthetic documents | Checks that apply across files. |
| AI decision systems | Checks that apply across files. |
| Confidentiality & client information | Checks that apply across files. |
| AML/CTF — the practice as a reporting entity | Checks that apply across files. |
What changes in New Zealand
| Topic | What changes |
|---|---|
| Governing law | The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act 2021 amended the FMCA, Financial Reporting Act 2013 and Public Audit Act 2001. |
| Climate statements | Climate reporting entities publish statements from financial years commencing on or after 1 January 2023, under XRB climate standards. |
| Assurance | Independent assurance of GHG-emissions disclosure for reporting years ending on or after 27 October 2024. |
| AASB S2 | Not the local standard. An FMA exemption treats it as an approved foreign standard for certain Australian entities. |
| Limits on AI assistance |
|
- FMA: climate reporting entities · 2026-09-23
- Financial Markets Conduct Act 2013 · 2026-09-23
What changes in United States
Known here as: Climate, ESG and sustainability disclosure
| Topic | What changes |
|---|---|
| What changes | No AASB S2 regime. Federal securities disclosure sits beside state climate and ESG statutes and FTC green-claims guidance. |
| SEC rules | Check the live SEC page before relying on any SEC climate or human-capital rule. |
| AI claims | SEC 2024-36: AI-related disclosure must be true. |
Precedents for this area
- Mandatory climate reporting readiness memo (Group 1, 2 or 3 entity) (Memo, AI use Red). Advice memo telling a client whether, from when and how it must prepare a sustainability report under Chapter 2M of the Corporations Act and AASB S2, with its reporting group, first reporting year, assurance phasing, liability settings and a readiness plan.
- Greenwashing review checklist for environmental and sustainability claims (Checklist, AI use Red). Pre-publication checklist for environmental, climate and sustainability claims in marketing, product disclosure and corporate reporting, mapped to the ACCC's eight principles, the ASIC greenwashing guidance and the misleading conduct provisions.
- Verification protocol for AI-extracted emissions data and AI-drafted sustainability disclosures (Policy, AI use Yellow). Internal protocol requiring source tracing and human verification whenever AI extracts emissions or ESG data, summarises supplier questionnaires or drafts sustainability report narrative, so AI errors do not become misleading statements or undermine the directors' declaration.
- Modern slavery and human rights supplier clause with audit rights (Clause, AI use Yellow). Supply contract clause requiring suppliers to identify and address modern slavery risks, cooperate with due diligence and audits, report incidents, remediate, and flow obligations down, supporting the buyer's Modern Slavery Act statement.
- Board paper: directors' declaration on the sustainability report (Memo, AI use Yellow). Board paper that equips directors to make the directors' declaration on the climate statements, sets out the reasonable-steps evidence, assurance findings, key judgments, protected statements and AI use, and proposes the resolution.
- Prompt template: climate disclosure gap list and first-draft narrative (with guardrails) (AI prompt, AI use Yellow). Two-stage prompt for an approved AI tool: map data-room documents to the AASB S2 headings the lawyer supplies and list gaps, then draft governance, strategy, risk and metrics narrative that marks every sentence without a source.
All precedents for Climate, ESG & Sustainability Reporting. Signed-in accounts can read the full text.