Australia / Guides / AASB S2 climate reporting groups: who is caught, and when
Australia · guideAASB S2 climate reporting groups: who is caught, and when
The short answer
An entity is caught by Australia's mandatory climate reporting regime if it already has to prepare a financial report under Chapter 2M of the Corporations Act and meets at least two of three consolidated size thresholds for its group, or if it is captured on one of two independent paths that bypass the size test entirely — and those two paths land in different groups, not the same one. A corporation registered under the NGER Act above the threshold in s.13(1)(a) is pulled into Group 1; other NGER-registered corporations that don't clear that specific threshold fall to Group 2. Registrable superannuation entities, registered schemes, and retail CCIVs with $5 billion or more in assets are expressly carved OUT of Group 1 regardless of size — even the largest super funds only start at Group 2. Group 1 (consolidated revenue $500M+, gross assets $1B+, or 500+ employees) reports from financial years starting on or after 1 January 2025. Group 2 ($200M / $500M / 250 employees, plus the $5B asset-owner and lower-tier NGER entities above) follows from 1 July 2026, and Group 3 ($50M / $25M / 100 employees) from 1 July 2027. AASB S2 sets what goes in the report; ASIC Regulatory Guide 280 sets ASIC's expectations for how it is prepared and lodged; a 2026 Federal Budget proposal to raise the separate large-proprietary-company thresholds would shrink Group 3 without changing the Act's climate thresholds themselves — worth checking before assuming Group 3 status either way.
Key facts — verified dates on each
The size test: two of three, on consolidated figures
Section 292A of the Corporations Act 2001, inserted by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024, sets three thresholds per group — consolidated revenue, consolidated gross assets, and employee count. An entity is assigned to a group if it meets at least two of that group's three thresholds for the financial year. All three figures are consolidated: the parent plus everything it controls, not the standalone entity.
Where a parent entity prepares consolidated financial statements, section 292A(2) lets the parent prepare the sustainability report for the whole consolidated group, and the parent is then the only entity in the group required to prepare one — subsidiaries inside the consolidation are not each expected to lodge their own.
The test only applies to entities that already have to prepare a financial report under Chapter 2M. An entity outside Chapter 2M's financial reporting obligations does not become a sustainability reporter through the size test alone.
- Group 1 — from FY starting 1 Jan 2025: revenue $500M+, gross assets $1B+, or 500+ employees (2 of 3)
- Group 2 — from FY starting 1 Jul 2026: revenue $200M+, gross assets $500M+, or 250+ employees (2 of 3)
- Group 3 — from FY starting 1 Jul 2027: revenue $50M+, gross assets $25M+, or 100+ employees (2 of 3)
Two paths that catch entities regardless of size — but not into the same group
Section 292A also captures two categories independently of the revenue/assets/employees test, and the two land in different groups. Corporations registered (or required to be registered) under the National Greenhouse and Energy Reporting Act 2007 that meet the threshold in NGER Act s.13(1)(a) are pulled into Group 1 on their emissions registration alone, on the reasoning that an entity already measuring and reporting its emissions at that scale has the systems to report on climate more broadly. NGER-registered corporations that don't meet that specific s.13(1)(a) threshold are not exempt — they fall to Group 2 instead.
Registrable superannuation entities, registered schemes, and retail corporate collective investment vehicles with $5 billion or more in assets are captured independently of the revenue and employee legs of the size test that apply to trading entities — but they are expressly carved OUT of Group 1. Even a very large superannuation fund or registered scheme only starts reporting as part of Group 2, from financial years starting 1 July 2026, not on Group 1's 2025 timeline. For retail CCIVs the $5 billion is tested across the whole vehicle — the sum of all sub-funds' assets, not any single sub-fund alone. Both asset-owner and lower-tier-NGER categories sit alongside, not inside, the Group 1/2/3 size bands built on revenue/assets/employees — an entity can be small on those three metrics and still be in scope on emissions registration or asset value, just not necessarily on Group 1's clock.
AASB S2 sets the content, RG 280 sets ASIC's expectations
AASB S2 Climate-related Disclosures is the accounting standard a sustainability report must follow — it sets out the governance, strategy, risk management, and metrics-and-targets disclosures required, built on the same four-pillar structure as the international ISSB standard. It is the "what goes in the report" answer.
ASIC Regulatory Guide 280, Sustainability reporting, is ASIC's guidance on how it expects entities to approach preparation, directors' involvement, and the assurance and enforcement posture during the phase-in. ASIC has signalled a proportionate approach in the early years of the regime while it monitors the first reports lodged by Group 1 entities, but RG 280 does not relax the statutory deadlines or the group thresholds themselves — those come from the Act.
Lodgment rides the annual-report clock, not a separate calendar
The sustainability report is prepared and lodged as part of the same annual reporting cycle as the financial report under Chapter 2M, not on a separate climate-specific calendar. An entity's existing financial-year end and its existing annual-report lodgment deadline with ASIC set the sustainability report's deadline too — the trigger is the financial year the entity's group starts reporting from, and the clock from there is the one already governing its annual report.
Climate-related financial disclosures are also subject to assurance requirements broadly comparable to those already applying to financial reports under the Corporations Act, phased in alongside the group rollout rather than switched on all at once for every group on day one.
A 2026 Budget proposal would move the Group 3 line — not yet law
The 2026-27 Federal Budget proposed doubling two of the three thresholds that define a "large proprietary company" for Chapter 2M financial reporting purposes: consolidated revenue from $50 million to $100 million, and consolidated gross assets from $25 million to $50 million, with the 100-employee threshold left unchanged. That is a different test from the section 292A climate groups above, but the two interact — an entity that stops being a "large proprietary company" under the raised thresholds would also stop being required to prepare the Chapter 2M financial report that section 292A's size test is anchored to, which would remove it from Group 3 exposure without any change to the climate thresholds themselves.
As at this review, the change is a Budget announcement only: no bill has been introduced and no commencement date is set. The Government has also flagged a separate consultation on reducing the compliance burden of the climate disclosure regime itself, including how concepts like "undue cost or effort" apply and whether assurance settings for smaller entities are proportionate. Neither the proprietary-company threshold change nor the climate-disclosure consultation has altered the Group 1/2/3 dates or thresholds in section 292A as it currently stands — an entity assessing its own status should check the current legislative position rather than plan around the proposal as if it were already law.
The figures, and when we checked them
These numbers change by year or by notification. Each one shows the date we last verified it against the source — if that date looks old, check the source before relying on it.
Questions on this
Which group does an entity fall into under AASB S2?
Whichever group it meets at least two of the three consolidated thresholds for — revenue, gross assets, and employees — checked against Group 1 first, then Group 2, then Group 3, on consolidated figures for the entity plus anything it controls.
When does Group 1 start reporting?
From financial years starting on or after 1 January 2025. Group 2 follows from 1 July 2026 and Group 3 from 1 July 2027.
Can an entity be caught even if it is well under the Group 3 size thresholds?
Yes, on two separate paths that land in different groups. Corporations registered under the NGER Act above the s.13(1)(a) threshold go into Group 1 on that basis alone; NGER-registered corporations under that threshold fall to Group 2. Registrable superannuation entities, registered schemes, and retail CCIVs with $5 billion or more in assets are also captured independently of the revenue/assets/employees test, but are carved out of Group 1 specifically — they start at Group 2, from FY 1 July 2026, even at very large scale.
What is the difference between AASB S2 and ASIC RG 280?
AASB S2 is the accounting standard that sets what a sustainability report must disclose. ASIC Regulatory Guide 280 is ASIC's guidance on its expectations for preparation and its supervisory approach during the phase-in. RG 280 does not change the statutory thresholds or deadlines set in the Corporations Act.
Does a subsidiary inside a consolidated group have to lodge its own sustainability report?
Not if the parent prepares consolidated financial statements and elects to prepare the sustainability report for the consolidated group under section 292A(2) — the parent is then the only entity in the group required to lodge one.
When is the sustainability report due?
On the same annual-report cycle as the entity's existing Chapter 2M financial report, not a separate climate-specific calendar. The entity's own financial-year end and ASIC lodgment deadline apply.
Is the proposal to raise large-proprietary-company thresholds already in effect?
No. As at this review it is a 2026-27 Federal Budget announcement only, with no bill introduced and no commencement date. It targets the separate Chapter 2M "large proprietary company" test, not the section 292A climate group thresholds directly — but because Group 3 status depends on already being a Chapter 2M reporter, a change to that test could still move some entities out of Group 3 scope if and when it is legislated.
Who prepares, signs, assures, and lodges a sustainability report?
Preparation is the entity's and its advisers' work; the report is a director-signed statement like the financial report it accompanies; assurance is performed by an AUASB-registered assurance practitioner, broadly comparable to financial-report audit requirements, phased in alongside the group rollout; and lodgment with ASIC is the entity's own statutory obligation, filed the same way as its existing annual report.
Primary sources
- Corporations Act 2001 (Cth) — s.292A, Who has to prepare annual sustainability reports (as inserted by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024)
- Australian Government Budget 2026-27 — Productivity chapter (company reporting threshold measure; official page does not itemise the exact dollar figures)
- ASIC Regulatory Guide 280 — Sustainability reporting
- AASB S2 — Climate-related Disclosures (standard text)
Last reviewed 2026-08-15. Statutes and schedules change — the sources above are authoritative, this page is orientation.
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