Building Your Mandatory Climate Report — Session 1: AASB S2 Foundations & Readiness Assessment

What the webinar was about

Afonso Firmo (co-CEO, NetNada) and Marco from Acumentis ESG ran session 1 of a 5-part series for sustainability managers, finance leads and consultants preparing an AASB S2 climate-related financial disclosure. The session covers who has to report (Groups 1, 2 and 3), the four pillars of an S2 report, what assurance applies and when, and how to run a readiness assessment before you start writing anything. Marco demos Acumentis’s Assess tool — a 20-question diagnostic that scores readiness across governance, strategy, risk management, and metrics & targets, and returns a 90-day action plan benchmarked to your industry.

Watch if you’re in Group 2 or Group 3, you’ve been handed the climate report and you don’t know where to start, or you’re a consultant building a delivery methodology for clients.

Top takeaways

1. AASB S2 is about financial risk, not sustainability. The legislation asks how a changing climate — physical, political, regulatory — affects your ability to keep making money. Frame it that way for your board and the room gets quieter.
2. Your reporting group can shift mid-period. Group thresholds apply at the end of the reporting period. An acquisition, headcount jump or contractor-to-employee conversion can push you from Group 3 into Group 2. Check forecasts, not just current numbers.
3. Reports don’t need to be long. KPMG’s review of the first Group 1 reports found a median length of 31 pages. The University of Sydney’s was 16. You can produce an S2-aligned report in a formatted Word document. Precision beats volume.
4. Build strategy last. Do governance, risk management, and metrics & targets first — then write the strategy section to tie them together. Risk management is the most misunderstood pillar and the one most likely to need external support (scenario analysis is where most teams get stuck).
5. Not everything needs assurance in year one. Scope 3, transition plans and climate-related metrics & targets have limited or no mandatory assurance in year one — but they still have to be in the report. Sequence your effort around what the auditor will test.
6. Pay-linked climate targets are not mandatory in year one. Only about half the Group 1 reporters tied executive remuneration to climate targets. If your exec team is nervous, you can defer it.
7. Do a readiness assessment before you do anything else. 80% of webinar attendees hadn’t done one. Marco’s point: most companies start at 10–20% readiness. That’s fine — you can only build a plan once you know the gap.
8. Pick your lane: minimum viable compliance or capability building. Most companies sit at one of two poles — “get us a tick, move on” or “treat this as a commercial asset.” Decide which you’re doing before you scope the work.

FAQs

Who has to report under AASB S2?

Group 1 is already reporting. Group 2 and Group 3 follow on a staggered schedule based on consolidated gross revenue, assets and employees at the end of the reporting period. Even if you’re not yet legislated to report, expect client RFIs to pull Group 3 companies into voluntary disclosure before the law catches up.

What’s the difference between S1 and S2?

S1 is the voluntary general sustainability standard. S2 is the mandatory climate standard. When you see Group 1 companies publishing broader sustainability reports, they’re often doing both. You only have to do S2.

How long does the work take?

Acumentis plans around ~90 days of build, then ~60 days working with the assurance provider. Phases run in sequence — you can’t set a target before you have a baseline, and you can’t do scenario analysis before you’ve identified risks.

How long should the report be?

Short is fine. 11 pages is doable. 31 is the Group 1 median. Don’t pad it to look serious.

Who needs to be in the room?

Executives (for governance oversight), sustainability (project lead), finance (data and projections), risk/compliance (to fold climate into your existing enterprise risk register — don’t build a new one), procurement/supply chain (Scope 3), and IT/data if you want this to scale.

What’s the biggest gap most companies have?

Education. Once the board and exec team understand this is a financial risk regulation, not a PR exercise, the rest unlocks.

Can I see examples?

Yes — NetNada has compiled every Group 1 report into a searchable database you can filter by pillar or industry, plus a minimum-viable reporting template you can start editing today. Both shared after the webinar.

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If you have any questions about the session, please email us at support@netnada.com.au