The National Party will support the new financial sector climate-reporting legislation through its second reading, MP Todd McClay told parliament last week.
Not that it matters. Labour and the Green parties already have the numbers to pass the legislation as-is but McClay said National would table amendments calling for an extended implementation time-table, including government entities in the reporting regime and reinstituting the ‘comply-or-explain’ get-out clause removed during the select committee process.
“In those three areas, we will be tabling SOPs and hope the Government will work with us to make sure the legislation is not onerous upon these businesses but actually at least is around the intent of what the Government wants to do, which is send a signal, not actually have any impact upon climate change,” McClay said.
As reported in August, the select committee recommended a raft of changes to the Financial Sector (Climate-related Disclosures and Other Matters) Amendment Bill, notably:
- excluding listed entities with a market capitalisation below $60 million;
- dropping the licensing and accreditation rules for GHG “assurance practitioners” that were to be governed by the Financial Markets Authority (FMA);
- removing the option for entities to opt-out of climate-reporting under “disclose-or-explain provisions”;
- cutting the requirement for entities to explain why some information has been left out of climate reports on ‘immateriality’ grounds;
- clarifying how amalgamated firms will be treated under the law; and,
- inserting a clause making it a criminal offence (with a maximum $50,000) fine for climate ‘assurance practitioners’ to breach as-yet-undefined professional standards.
Once passed, the legislation will impose significant climate-reporting duties on a wide range of entities including all licensed fund managers with $1 billion plus of assets under management.
Climate Minister James Shaw said the government would be introducing further amendments via supplementary order papers to “address the concerns of a few key stakeholders following the select committee process” but the law is likely to remain substantially in line with the final reported version.
“This bill has already caught the attention of Governments and people around the world because it provides accountability for the actions of large listed businesses and financial institutions in relation to climate change,” Shaw said in parliament. “This will help the sector to be a part of the solution rather than a part of the problem in the face of the climate change challenge.”
Labour MP Glen Bennett, meanwhile, put the prospective law in context of the broader trend of investors demanding more information on underlying corporate behaviour.
“… for me personally, as a member of KiwiSaver, is that when I was for many years just passive on that service, to suddenly realise I can actually look at where my investments are going—so I was able to look at ethical investments. And again, I could have invested in whatever company I wanted, but I could then look and see, and I had opportunities,” Bennett said.
“And again, with this piece of legislation, it allows people to look, to see, because it’s around the future, as the Hon James Shaw said. It’s around looking at the generations coming through. This is around intergenerational equity. And so having this piece of legislation in place, I think, is really important for the future of New Zealand.”
McClay, however, said the bill would not “directly have any effect upon a company and climate change, or that company’s part in climate change”.
In other matters, he also called out Shaw for his scheduled in-person trip to the COP26 climate change conference in Glasgow next month.
“The best way Mr Shaw can have an impact upon climate change is to Zoom to that conference over in Glasgow, not get on a plane with 10 other people,” McClay said.