Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act 2021

1: Title
This Act is the Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act 2021.
2: Commencement
1: The following parts of this Act come into force on the day after Royal assent:
a: Part 3 sections 44(1) and 45
b: section 55(1)
2: The rest of this Act comes into force on a date or dates set by Order in Council.
3: However,—
a: any part of this Act, other than Part 2 subpart 1 of Part 4
b: any part of Part 2 subpart 1 of Part 4
4: An Order in Council made under this section is secondary legislation ( see Part 3 The following table is small in size and has 3 columns that are grouped under the heading Legislation Act 2019 requirements for secondary legislation made under this section. Legislation Act 2019 requirements for secondary legislation made under this section Publication PCO must publish it on the legislation website and notify it in the Gazette LA19 s 69(1)﻿(c) Presentation The Minister must present it to the House of Representatives LA19 s 114 cl 32(1)﻿(a) Disallowance It may be disallowed by the House of Representatives LA19 ss 115 116 This note is not part of the Act.
1: Amendments to Financial Markets Conduct Act 2013 to come into force by first anniversary of Royal assent
3: Principal Act
This Part amends the Financial Markets Conduct Act 2013 2022-10-27 Financial Markets Conduct Act 2013 see s 2(3)﻿(a): any part of Part 1 that has not come into force by the first anniversary of Royal assent comes into force then 2024-10-27 Financial Markets Conduct Act 2013 see s 2(3)﻿(b): any part of Part 2 that has not come into force by the third anniversary of Royal assent comes into force then
4: Section 5 amended (Overview)
After section 5(1)﻿(g)
ga: Part 7A
5: Section 6 amended (Interpretation)
1: In section 6(1) applicable climate standard authoritative notice climate-related disclosure framework section 9AA climate reporting entity section 461O climate statements CRD records subpart 2 Part 7A group climate statements overseas climate reporting entity Part 7A
a: is incorporated outside New Zealand; and
b: is a climate reporting entity under section 461O(1)﻿(b) to (e) see section 461Q(3) and (4) Part 7A climate-related disclosure provision section 461ZK(3) or (4) separate fund 7A
2: In section 6(1) group group
a: in Part 7 and subpart 1 of Part 7A
b: in Part 7A subpart 1
3: In section 6(1) licensed insurer section 238(1)﻿(b) of that Act section 238(1)﻿(b)﻿(i)﻿(A) or (ii) of that Act; and
4: In section 6(1) licensed insurer
c: in Part 7A
5: In section 6(1) subsidiary Part 7 Parts 7 and 7A
6: Section 351 amended (Regulations modifying this Part or Part 7 for licensed markets)
1: In the heading to section 351 7 or 7A
2: Replace section 351(1)﻿(ab)
ab: providing that section 451(1)﻿(d) does not apply in respect of persons that are listed issuers only in respect of a licensed market or class of licensed markets, and providing for replacement or modified requirements to apply relating to—
i: accounting records and financial reporting:
ii: CRD records and climate-related disclosures (for those listed issuers that would otherwise be climate reporting entities under section 461O(1)﻿(a)
7: Section 461C amended (Failure to comply with authoritative notice does not give rise to pecuniary penalty)
Repeal section 461C(3)
8: New Part 7A inserted
After Part 7
7A: Climate-related disclosures for certain FMC reporting entities with higher level of public accountability
1: Overview, application, and interpretation
461N: Overview
1: This Part provides for climate reporting entities to—
a: keep proper records relating to their obligations to make climate-related disclosures; and
b: prepare climate statements; and
c: lodge those statements.
2: This section is only a guide to the general scheme and effect of this Part.
461O: Meaning of climate reporting entity
1: In this Act, a person who is an FMC reporting entity that, under section 461K, is considered to have a higher level of public accountability than other FMC reporting entities is a climate reporting entity
a: a listed issuer that—
i: is a large listed issuer; and
ii: is not an excluded listed issuer:
b: a registered bank that is large:
c: a licensed insurer that is large:
d: a credit union that is large:
e: a building society that is large.
2: In this Act, a manager of a registered scheme (other than a restricted scheme) is a climate reporting entity
a: the manager is a large manager; and
b: section 461K(1)﻿(b) applies to the manager in respect of the scheme.
3: In this section,— excluded listed issuer section 461P large section 461Q large listed issuer section 461P large manager section 461S
461P: Definitions relating to listed issuers
1: For the purposes of this Part, a listed issuer is a large listed issuer
a: the listed issuer,—
i: at any time in the accounting period, has quoted equity securities; and
ii: as at the balance date of each of the 2 preceding accounting periods, has equity securities (whether quoted or unquoted) that have a total value, as implied by the market price or fair value of those equity securities, that exceeds $60 million:
b: the listed issuer,—
i: at any time in the accounting period, has quoted debt securities; and
ii: at any time in the 2 preceding accounting periods, has quoted debt securities with a total face value that exceeds $60 million:
c: the listed issuer is large after amalgamation (within the meaning of section 461R
2: For the purposes of this Part, a listed issuer is an excluded listed issuer
a: any equity securities of the issuer and any debt securities of the issuer that are quoted are quoted only on a growth market; or
b: the issuer has no quoted equity securities and no quoted debt securities.
3: And see section 351(1)﻿(ab) section 461O(1)﻿(a)
4: For the purposes of subsection (1)﻿(a)﻿(ii)
5: In this section, growth market
a: the operator has a licence to operate the market issued under section 316; and
b: either or both of the following apply:
i: the licence is subject to a condition that limits the size of issuers that are eligible to become, or to remain, listed issuers on the financial product market (for example, a limit based on the issuer’s market capitalisation):
ii: the market is otherwise designed for, and clearly targeted at, small- and medium-sized entities.
461Q: Meaning of large (in relation to registered banks, licensed insurers, credit unions, and building societies)
1: For the purposes of this Part, a registered bank, credit union, or building society ( A large
a: as at the balance date of each of the 2 preceding accounting periods, the total assets of A and A’s subsidiaries (if any) exceed $1 billion:
b: A is large after amalgamation (within the meaning of section 461R
2: For the purposes of this Part, a licensed insurer is large
a: as at the balance date of each of the 2 preceding accounting periods, the total assets of the licensed insurer and its subsidiaries (if any) exceed $1 billion:
b: in each of the 2 preceding accounting periods, the annual gross premium revenue of the licensed insurer and its subsidiaries (if any) exceeds $250 million:
c: the licensed insurer is large after amalgamation (within the meaning of section 461R
3: However, if a registered bank, credit union, building society, or licensed insurer is an overseas company,—
a: subsections (1) and (2)
b: the overseas company is large for the purposes of section 461O(1)﻿(b) to (e) subsection (4)
4: The New Zealand business of an overseas company or its group is large
a: as at the balance date of each of the 2 preceding accounting periods, the total assets of the New Zealand business exceed $1 billion:
b: the overseas company is a licensed insurer and, in each of the 2 preceding accounting periods, the annual gross premium revenue of the New Zealand business exceeds $250 million.
5: A financial reporting standard (or a part of a standard) issued by the External Reporting Board that is expressed as applying for the purposes of subsection (4)
6: In this section, overseas company
461R: Meaning of large after amalgamation
1: For the purposes of this Part, a person ( A large after amalgamation
a: A amalgamated with a large entity during the accounting period; or
b: A is a new entity formed on the amalgamation of 2 or more entities during the accounting period, and at least 1 of those entities was a large entity.
2: If A is large after amalgamation under subsection (1) large after amalgamation
3: In this section, large entity
a: a large listed issuer under section 461P(1) section 461P(2)﻿(a) or (b)
b: a registered bank, licensed insurer, credit union, or building society that is large under section 461Q
461S: Meaning of large manager
1: For the purposes of this Part, a manager ( A large manager
a: all schemes for which A is manager; and
b: all schemes for which the manager is an authorised body that provides the service of acting as a manager of a registered scheme under A’s market services licence.
2: If A is a large manager, every manager described in subsection (1)﻿(b) large manager Example
Company A holds a licence that covers acting as a manager of registered schemes. A’s subsidiaries, B and C, also provide this service under A’s licence (as authorised bodies). The assets of the schemes for which A is manager total $700 million on the balance date of each of A’s 2 preceding accounting periods (the relevant balance dates The assets of the schemes managed by B total a further $300 million, and the assets of the schemes managed by C total $200 million, on each of the relevant balance dates. The total assets therefore exceed $1 billion. A is a large manager. B and C are also large managers.
3: Subsections (4) and (5)
a: a manager and a scheme managed by the manager have different balance dates; and
b: the manager becomes, or ceases to be, a large manager.
4: If the manager was not a large manager in respect of an accounting period ( AP1 AP2
a: is not treated as a large manager in respect of the scheme in relation to the accounting period of the scheme that starts in AP1 and ends in AP2 unless paragraph (b)
b: must be treated as a large manager in respect of the scheme in relation to the accounting period of the scheme that starts in AP1 and ends in AP2 if—
i: the manager was not the manager of the scheme at the start of that accounting period of the scheme; and
ii: the manager at the start of that accounting period of the scheme was a climate reporting entity in respect of the scheme.
5: If the manager was a large manager in respect of an accounting period ( AP3 AP4
6: In this section, the total assets
a: as reported in the most recent audited financial statements, prepared in accordance with generally accepted accounting practice, for the scheme; or
b: if there are no such statements, as calculated—
i: for a date as near as possible to the balance date of the manager; and
ii: as if for the purpose of preparing financial statements for the scheme in accordance with generally accepted accounting practice.
7: In this section, scheme
461T: Application if person’s status changes during accounting period
1: If a person ceases to be a climate reporting entity during an accounting period, that person is treated as continuing to be a climate reporting entity in relation to that accounting period for the purposes of this Act and every other enactment.
2: However, subsection (3) A
a: ceased to be a climate reporting entity under section 461O(1)
b: on the balance date, is not a climate reporting entity under section 461O(1) subsection (1)
3: If this subsection applies,—
a: A is not required to ensure the completion of climate statements or group climate statements under any of sections 461Z to 461ZB
b: records required to be kept by A up to the date that A ceased to be a climate reporting entity under section 461O(1) sections 461W to 461Y
4: In any case where a person is, or was, the manager of a registered scheme (and a climate reporting entity under section 461O(2) subsection (1)
a: section 461S(5)
b: section 461ZD
461U: Miscellaneous provision relating to application
Nothing in this Part requires a climate reporting entity to ensure the completion of climate statements or group climate statements and the lodgement of those climate statements in relation to an accounting period that ended before the accounting period in which that person became a climate reporting entity.
2: CRD records
461V: Climate reporting entities must keep proper CRD records
1: Every climate reporting entity under section 461O(1)
2: Every manager that is a climate reporting entity in respect of a registered scheme must ensure that there are kept at all times records that will enable the manager to ensure that the climate statements relating to the registered scheme comply with the climate-related disclosure framework.
3: Every climate reporting entity must establish and maintain a satisfactory system of control of the records that it is required to keep under this section.
4: In this section,— climate statements of the climate reporting entity sections 461Z to 461ZB climate statements relating to the registered scheme section 461ZC
461W: Manner in which CRD records to be kept
1: Every climate reporting entity must keep the CRD records in the prescribed manner (if any).
2: A climate reporting entity that contravenes this section commits an offence and is liable on conviction to a fine not exceeding $50,000.
3: The offence in this section is an infringement offence ( see
461X: Period for which CRD records to be kept
CRD records, or copies of them, must be retained by the climate reporting entity for a period of at least 7 years after the date the records are made.
461Y: Inspection of CRD records
1: Every climate reporting entity must make the CRD records available, in the prescribed manner at all reasonable times for inspection without charge, to—
a: the directors of the climate reporting entity; and
b: any supervisor (if the climate reporting entity is an issuer of debt securities or the manager of a registered scheme); and
c: the FMA; and
d: any other persons authorised or permitted by an enactment to inspect the CRD records of the climate reporting entity or scheme.
2: A climate reporting entity that contravenes this section commits an offence and is liable on conviction to a fine not exceeding $50,000.
3: The offence in this section is an infringement offence ( see
3: Preparation of climate statements
Climate statements of climate reporting entities
461Z: Climate statements must be prepared
1: Every climate reporting entity must ensure that, within 4 months after the balance date of the entity, climate statements that comply with the climate-related disclosure framework are—
a: completed in relation to the entity and that balance date; and
b: dated and signed on behalf of the entity by 2 directors of the entity or, if the entity has only 1 director, by that director.
2: However, subsection (1)
a: a climate reporting entity that, on the balance date referred to in subsection (1)
b: an overseas climate reporting entity, unless it is a climate reporting entity under section 461O(1)﻿(a)
c: a person that is a climate reporting entity only under section 461O(2) Example
A company (incorporated in New Zealand and with no subsidiaries) is a large manager of 2 registered schemes. The company is also a large registered bank, so subsection (2)﻿(c) Subsection (1) see section 461ZC
461ZA: Group climate statements must be prepared
1: Subsection (2)
2: The climate reporting entity must ensure that, within 4 months after that balance date, group climate statements that comply with the climate-related disclosure framework are—
a: completed in relation to the group and that balance date; and
b: dated and signed on behalf of the entity by 2 directors of the entity or, if the entity has only 1 director, by that director.
3: However, subsection (2)
a: an overseas climate reporting entity, unless it is a climate reporting entity under section 461O(1)﻿(a)
b: a person that is a climate reporting entity only under section 461O(2)
461ZB: Climate statements for overseas climate reporting entities
1: This section applies to every overseas climate reporting entity, unless it is a climate reporting entity under section 461O(1)﻿(a)
2: The climate reporting entity must ensure that, within 4 months after the balance date of the entity, climate statements that comply with the climate-related disclosure framework are—
a: prepared for its New Zealand business as if that business were conducted by a company formed and registered in New Zealand; and
b: dated and signed on behalf of the entity by 2 directors of the entity or, if the entity has only 1 director, by that director.
3: However, if the climate reporting entity has, on that balance date, 1 or more subsidiaries, subsection (2)
a: prepared for the group’s New Zealand business as if the members of the group were companies formed and registered in New Zealand; and
b: dated and signed on behalf of the entity by 2 directors of the entity or, if the entity has only 1 director, by that director.
4: Subsection (3) Climate statements relating to registered schemes
461ZC: Climate statements for separate funds of registered schemes, etc
1: This section applies to every manager of a registered scheme that is a climate reporting entity in respect of the scheme.
2: The manager must ensure that, within 4 months after the balance date of the scheme, climate statements that comply with the climate-related disclosure framework are—
a: completed in relation to each separate fund of the scheme and that balance date; and
b: if any liabilities of the manager and the scheme are not limited to a separate fund, completed in relation to the scheme and that balance date; and
c: dated and signed on behalf of the manager by 2 directors of the manager or, if the manager has only 1 director, by that director.
3: However, if the manager was not the manager of the scheme at the start of the scheme’s accounting period, subsection (2)
461ZD: Application if manager of registered scheme changes and new manager is not large manager
1: This section applies if—
a: the manager of a registered scheme changes during an accounting period of the scheme; and
b: the person who was the manager of the scheme at the start of the accounting period (the old manager
c: the person who is the manager of the scheme at the end of the accounting period (the new manager section 461S
2: If this section applies, the new manager is not required to ensure the completion of climate statements under section 461ZC(2)
3: Records kept by the old manager up to the date that the old manager ceased to hold office as manager of the scheme are CRD records for the purposes of sections 461W to 461Y Miscellaneous
461ZE: Climate statements may be combined in single document
Nothing in this Part prevents any of the following from being combined in a single document:
a: climate statements and group climate statements that are required to be prepared under any of sections 461Z to 461ZB
b: climate statements that are required to be prepared under section 461ZC
461ZF: Failure to comply with authoritative notice does not give rise to pecuniary penalty
1: This section applies if climate statements or group climate statements referred to in this subpart fail to comply with the climate-related disclosure framework as a result of a failure to comply with an authoritative notice.
2: A pecuniary penalty order may not be made under section 489 in relation to the failure to comply with the authoritative notice. s 461C Offences
461ZG: Offence to knowingly fail to comply with climate standards
1: A climate reporting entity and every director of the entity commit an offence if—
a: any of the following fail to comply with an applicable climate standard:
i: the climate statements of the entity prepared under section 461Z
ii: group climate statements in relation to a group comprising the entity and its subsidiaries prepared under section 461ZA
iii: the climate statements or group climate statements prepared by the entity under section 461ZB
iv: in the case of a manager of a registered scheme, the climate statements for any separate fund or for the scheme prepared under section 461ZC
b: the entity or the director (as the case may be) knows that the climate statements or group climate statements fail to so comply when those statements are lodged.
2: A person who commits an offence under subsection (1)
a: in the case of an individual, to imprisonment for a term not exceeding 5 years, a fine not exceeding $500,000, or both; and
b: in any other case, to a fine not exceeding $2.5 million. s 461I
4: Assurance engagements
461ZH: No requirement for assurance of climate statements on commencement of Part
1: A climate reporting entity is not required to obtain an assurance engagement in relation to the climate statements or group climate statements that are required to be prepared under any of sections 461Z to 461ZC
2: See Part 2
5: Lodgement of climate statements
461ZI: Lodgement of climate statements
1: Every climate reporting entity that is required to prepare climate statements or group climate statements under any of sections 461Z to 461ZB
2: Every manager that is a climate reporting entity in respect of a registered scheme must ensure that, within 4 months after the balance date of the scheme, copies of the climate statements that are required to be prepared under section 461ZC
3: A climate reporting entity that contravenes this section commits an offence and is liable on conviction to a fine not exceeding $50,000.
4: The offence in this section is an infringement offence ( see
461ZJ: Information about climate statements of climate reporting entities to be made available in annual report
1: This section applies to every climate reporting entity that is required to prepare—
a: climate statements or group climate statements under any of sections 461Z to 461ZB
b: an annual report under the Companies Act 1993 or any other enactment.
2: The climate reporting entity must include, in its annual report for the period ending on the balance date,—
a: a statement that the entity is a climate reporting entity for the purposes of this Act; and
b: a copy of the climate statements or group climate statements prepared by the entity under any of sections 461Z to 461ZB
3: A climate reporting entity that contravenes this section commits an offence and is liable on conviction to a fine not exceeding $50,000.
4: The offence in this section is an infringement offence ( see
5: In this section, annual report
6: Civil liability for certain contraventions of this Part
461ZK: Part 7A climate-related disclosure provisions
1: All of the provisions specified in subsections (3) and (4) Part 7A
2: A contravention of any of the provisions listed in subsection (3) see
3: For the purposes of subsection (2)
a: section 461V
b: sections 461Z to 461ZC
c: section 461ZI
4: A contravention of section 461X see
9: Section 462 amended (When FMA may make stop orders)
In section 462(1)﻿(ga) 7 or 7A
10: Section 468 amended (When FMA may make direction orders)
After section 468(1)﻿(f)
fa: a Part 7A
11: Section 470 amended (FMA may order that simplified disclosure PDS may not be used)
After section 470(1)﻿(b)
ba: any provision under Part 7A
12: Section 474 amended (FMA may order that exclusion for offers of products of same class as quoted products does not apply)
After section 474(1)﻿(b)
ba: any provision under Part 7A
13: Section 485 amended (What are civil liability provisions)
After section 485(g)
ga: a Part 7A
14: Section 489 amended (When court may make pecuniary penalty orders)
In section 489(3)﻿(b) or 461C , 461C, or 461ZF
15: Section 490 amended (Maximum amount of pecuniary penalty)
After section 490(2)﻿(f)
fa: a Part 7A section 461X
16: Section 501 amended (Additional disclosure or financial reporting defence for directors who are treated as contravening)
1: In the heading to section 501 reporting or climate-related disclosure
2: In section 501(1)﻿(a) and 461H 461H, 461Z to 461ZC, and 461ZI
17: Section 534 amended (Directors treated as having contravened in case of defective disclosure or financial reporting contravention)
1: In the heading to section 534 or financial reporting contravention , financial reporting contravention, or climate-related disclosure contravention
2: After section 534(1)﻿(ca)
cb: a climate reporting entity has contravened any of sections 461Z to 461ZC 461ZI
3: In section 534(3)
a: after FMC reporting entity, climate reporting entity,
b: after (ca), (cb),
4: In section 534(5) FMC reporting entity, climate reporting entity,
18: Section 554 amended (Regulations or exemptions may require compliance with generally accepted accounting practice, standards, or FMA frameworks or methodologies)
1: In the heading to section 554 or FMA frameworks or methodologies frameworks, or FMA methodologies
2: After section 554(1)﻿(b)
baaa: the climate-related disclosure framework, either generally or in specified circumstances:
ba: a climate standard:
3: In section 554(2) a financial reporting standard, the climate-related disclosure framework, a climate standard,
4: In section 554(3) climate standard
19: Section 556 amended (FMA may grant exemptions)
In section 556(1)﻿(a) 7 7A
20: Section 561A amended (Financial reporting exemptions)
1: Replace the heading to section 561A Financial reporting and climate-related disclosure exemptions
2: After section 561A(1)
1A: An exemption granted under this subpart in relation to any provision of Part 7A
3: In section 561A(2) 7 or 7A
21: Schedule 4 amended
1: In Schedule 4, clause 1(1)
g: Part 7 Part 1
2: In Schedule 4
a: insert the Part set out in Schedule 1
b: make all necessary consequential amendments.
2: Amendments to Financial Markets Conduct Act 2013 to come into force by third anniversary of Royal assent
22: Section 6 amended (Interpretation)
In section 6(1) assurance practitioner Part 7A
23: Section 461N amended (Overview)
After section 461N(1)﻿(b)
ba: to the extent that those statements are required to disclose greenhouse gas emissions, obtain an assurance engagement in relation to those statements; and
24: Section 461V amended (Climate reporting entities must keep proper CRD records)
Replace section 461V(1) and (2)
1: Every climate reporting entity under section 461O(1)
a: the climate reporting entity to ensure that the climate statements of the climate reporting entity comply with the climate-related disclosure framework; and
b: the assurance engagement required by section 461ZH
2: Every manager that is a climate reporting entity in respect of a registered scheme must ensure that there are kept at all times records that will enable—
a: the manager to ensure that the climate statements relating to the registered scheme comply with the climate-related disclosure framework; and
b: the assurance engagement required by section 461ZH
25: Section 461ZH replaced (No requirement for assurance of climate statements on commencement of Part)
Replace section 461ZH
461ZH: Assurance engagement required for parts of climate statements relating to greenhouse gas emissions
1: Every climate reporting entity must ensure that the climate statements or group climate statements that are required to be prepared under any of sections 461Z to 461ZC
2: None of the following persons may carry out the assurance engagement:
a: a director, an officer, or an employee of the climate reporting entity:
b: a person who is in partnership with, or in the employment of, a person specified in paragraph (a)
c: a liquidator or a person who is a receiver in respect of the property of the climate reporting entity:
d: a person who, by virtue of paragraphs (a) to (c)
3: In the case of a climate reporting entity that is a public entity under the Public Audit Act 2001, the only person who may carry out the assurance engagement is the Auditor-General or any other person who may act as the CRD assurance practitioner under that Act in respect of the assurance engagement.
461ZHA: Assurance engagement must be carried out in accordance with auditing and assurance standards
An assurance practitioner must, in carrying out an assurance engagement under this Part, comply with all applicable auditing and assurance standards.
461ZHB: Assurance practitioner’s report
1: The assurance practitioner’s report on the climate statements or group climate statements prepared by an entity under any of sections 461Z to 461ZC
2: If the assurance practitioner’s report indicates that the requirements of this Part have not been complied with, the assurance practitioner must, within 20 working days after signing the report, send a copy of the report, and a copy of the climate statements or group climate statements to which it relates, to—
a: the FMA; and
b: the External Reporting Board; and
c: in the case of a climate reporting entity that is an issuer of debt securities or a manager of a registered scheme, the supervisor.
3: An assurance practitioner who contravenes subsection (2)
461ZHC: Assurance engagement may cover other parts of climate statements
1: Section 461ZH
2: If an assurance engagement does cover the whole, or other parts, of the statements,—
a: the assurance practitioner’s report must separately identify the matters that are required to be the subject of the assurance engagement under section 461ZH
b: this subpart applies, with any necessary modifications, in relation to the whole of the assurance engagement.
3: In this section, other parts section 461ZH Assurance practitioner access to information
461ZHD: Climate reporting entity must give assurance practitioner access to information
1: Every climate reporting entity must ensure that an assurance practitioner appointed for an assurance engagement under this Part has access, at all times, to—
a: the CRD records of the climate reporting entity or scheme; and
b: any other documents of the climate reporting entity or scheme that are relevant to the assurance engagement.
2: If a climate reporting entity contravenes subsection (1)
3: In any proceeding against a director for a contravention of subsection (1)
a: the climate reporting entity took all reasonable steps to ensure that subsection would be complied with; or
b: the director took all reasonable steps to ensure that the climate reporting entity complied with that subsection; or
c: in the circumstances, the director could not reasonably have been expected to take steps to ensure that the climate reporting entity complied with that subsection. 2013 No 101 s 38
461ZHE: Assurance practitioner may require information and explanations from director or employee
1: An assurance practitioner appointed for an assurance engagement under this Part is entitled to require from a director or an employee of the climate reporting entity the information and explanations that the assurance practitioner thinks necessary for the performance of their duties as assurance practitioner.
2: A director or an employee who fails to comply with a requirement to provide information or an explanation under subsection (1)
3: In any proceeding against an employee for failing to comply with a requirement to provide information or an explanation under subsection (1)
a: the employee did not have the information required in their possession or under their control; or
b: by reason of the position occupied by the employee or the duties assigned to them, they were unable to give the explanations required. 2013 No 101 s 39
26: Section 461ZI amended (Lodgement of climate statements)
Replace section 461ZI(1) and (2)
1: Every climate reporting entity that is required to prepare climate statements or group climate statements under any of sections 461Z to 461ZB
a: the climate statements or group climate statements that are required to be prepared; and
b: the assurance practitioner’s report on those statements.
2: Every manager that is a climate reporting entity in respect of a registered scheme must ensure that, within 4 months after the balance date of the scheme, copies of the following are delivered to the Registrar for lodgement:
a: the climate statements that are required to be prepared under section 461ZC
b: the assurance practitioner’s report on those statements.
27: Section 461ZJ amended (Information about climate statements of climate reporting entities to be made available in annual report)
Replace section 461ZJ(2)﻿(b)
b: either—
i: a copy of the climate statements or group climate statements prepared by the entity under any of sections 461Z to 461ZB
ii: the address of (or a link to) the Internet site where a copy of those statements, together with the assurance practitioner’s report on those statements, can be accessed.
28: Section 461ZK amended (Part 7A climate-related disclosure provisions)
After section 461ZK(3)﻿(b)
ba: section 461ZH
29: Section 501 amended (Additional disclosure or financial reporting defence for directors who are treated as contravening)
In section 501(1)﻿(a) 461ZC, 461ZH,
30: Section 534 amended (Directors treated as having contravened in case of defective disclosure, financial reporting contravention, or climate-related disclosure contravention)
In section 534(1)﻿(cb) 461ZC , 461ZH,
31: Schedule 4 amended
1: In Schedule 4, clause 1(1)
h: Part 8 Part 2
2: In Schedule 4, clause 1(1)
3: In Schedule 4
a: insert the Part set out in Schedule 2
b: make all necessary consequential amendments.
3: Amendments to Financial Reporting Act 2013
32: Principal Act
This Part amends the Financial Reporting Act 2013 2021-10-28 Financial Reporting Act 2013 see s 2(1)﻿(a): Part 3 (except ss 44(1) and 45) come into force on the day after Royal assent 2022-10-27 Financial Reporting Act 2013 see s 2(2) & (3)﻿(a): if not brought into force earlier, ss 44(1) and 45 come into force on the first anniversary of Royal assent
33: Section 3 amended (Purpose)
1: In section 3(b) financial reporting standards , climate standards,
2: After section 3(c)
d: provide for standard provisions relating to climate-related disclosure duties under the Financial Markets Conduct Act 2013.
34: Section 4 amended (Overview of financial reporting duties)
1: In the heading to section 4 reporting and other
2: After section 4(2)
2A: This Act also provides for various matters relating to climate-related disclosure duties under the Financial Markets Conduct Act 2013, including—
a: defining key concepts (for example, climate-related disclosure framework, climate statements, and group climate statements); and
b: providing for the Board to prepare and issue climate standards.
3: In section 4(3) duties , and of this Act in relation to climate-related disclosure duties
35: Section 5 amended (Interpretation)
1: In section 5(1) applicable auditing and assurance standard applicable auditing and assurance standard
2: In section 5(1) applicable climate standard climate-related disclosure framework section 9AA climate reporting entity section 461O climate standard climate statements group climate statements
3: In section 5(1) reporting entity reporting entity
a: means an entity whose financial statements, group financial statements, reports, or other information is required by any enactment to comply, or be prepared in accordance, with generally accepted accounting practice or non-GAAP standards; or
b: means an entity whose climate statements, group climate statements, reports, or other information is required by any enactment to comply, or be prepared in accordance, with the climate-related disclosure framework
4: In section 5(1) standard
aa: a climate standard; or
36: New section 9AA inserted (Meaning of climate-related disclosure framework)
After section 9
9AA: Meaning of climate-related disclosure framework
In this Act, climate statements, group climate statements, a report, or other information complies with the climate-related disclosure framework
a: applicable climate standards; and
b: in relation to matters for which no provision is made in applicable climate standards, an authoritative notice.
37: Section 12 amended (Functions of Board)
1: After section 12(a)
aa: to prepare and, if it thinks fit, issue climate standards for the purposes of any enactment that requires climate statements or group climate statements, or a statement, report, or other information to comply, or be prepared in accordance, with the climate-related disclosure framework:
2: Replace section 12(c)
c: to prepare and, if it thinks fit, issue authoritative notices for the purposes of—
i: the definition of generally accepted accounting practice; or
ii: the definition of climate-related disclosure framework:
38: Section 14 amended (Membership of Board)
In section 14(2) or law law, or sustainable development
39: Subpart 2 heading in Part 2 replaced
In Part 2, replace the subpart 2
2: Standards
40: New sections 19A to 19C and cross-heading inserted
After section 19
19A: Guidance for purposes of non-financial reporting
1: The Board may issue non-binding guidance that relates to non-financial reporting on 1 or more of the matters in section 17(2)﻿(a)﻿(i) to (iv).
2: The purpose of the guidance is to facilitate best practice reporting on those matters.
3: The guidance—
a: must not be inconsistent with any financial reporting standard or authoritative notice; and
b: must state that it is non-binding.
4: Subsection (1)
a: applies regardless of whether an Order in Council is made under section 17(2):
b: does not limit the general powers of the Board. Climate standards
19B: Purpose of climate standards and climate-related disclosures
The purpose of climate standards is to provide for, or promote, climate-related disclosures, in order to—
a: encourage entities to routinely consider the short-, medium-, and long-term risks and opportunities that climate change presents for the activities of the entity or the entity’s group; and
b: enable entities to show how they are considering those risks and opportunities; and
c: enable investors and other stakeholders to assess the merits of how entities are considering those risks and opportunities.
19C: Climate standards
1: Climate standards may—
a: have general or specific application:
b: differ according to differences in time or circumstance.
2: A climate standard may be expressed to apply to all reporting entities or groups or to specified classes of reporting entities or groups.
3: A climate standard may specify the accounting periods or interim accounting periods in relation to which the standard applies.
41: Section 27 amended (When standards and authoritative notices take effect)
In section 27(2)﻿(a) accounting, climate-related,
42: Section 44 amended (Purpose)
Repeal section 44(b)
43: New subpart 6 heading in Part 2 inserted
In Part 2, after section 47
6: Monetary amounts adjusted for inflation
44: Section 48 amended (Minister must regularly review amounts to take into account inflation)
1: In section 48(1)﻿(a) and section 64(2) of the Friendly Societies and Credit Unions Act 1982 section 64(2) of the Friendly Societies and Credit Unions Act 1982, and sections 461Q and 461S of the Financial Markets Conduct Act 2013
2: In section 48(3) 8 6
45: Section 49 amended (Order may amend amounts)
After section 49(h)
i: amending the amounts specified in sections 461Q and 461S
j: amending the amounts in the example in section 461S
46: Section 51 amended (Levies)
After section 51(3)﻿(f)
fa: climate reporting entities; and
47: Schedule amended
1: In the Schedule
1: Provisions relating to Financial Reporting Amendment Act 2014
2: In the Schedule
a: insert the Part set out in Schedule 3
b: make all necessary consequential amendments.
4: Amendments to other Acts
1: Public Audit Act 2001
48: Principal Act
This subpart amends the Public Audit Act 2001 2024-10-27 Public Audit Act 2001 see s 2(3)﻿(b): any part of subpart 1 of Part 4 that has not come into force by the third anniversary of Royal assent comes into force then
49: Section 4 amended (Interpretation)
1: In section 4 appointed CRD assurance practitioner section 34A section 15B climate reporting entity section 461O
2: In section 4 Auditor-General appointed auditor or appointed CRD assurance practitioner
50: New section 15B inserted (CRD assurance practitioner for public entities)
After section 15A
15B: CRD assurance practitioner for public entities
1: The Auditor-General is, and must from time to time act as, the CRD assurance practitioner for an assurance engagement required for the purposes of Part 7A
2: In carrying out an assurance engagement under subsection (1)
51: New section 34A inserted (Appointment of CRD assurance practitioners)
After section 34
34A: Appointment of CRD assurance practitioners
1: The Auditor-General may from time to time appoint any of the following to act as a CRD assurance practitioner and to carry out, under section 15B Part 7A
a: an employee of the Auditor-General:
b: a person who, under section 461ZH(2)
2: An appointment must be in writing and may be made subject to any restrictions and conditions that the Auditor-General thinks fit.
3: The Auditor-General may authorise an appointed CRD assurance practitioner to exercise such of the powers listed in section 34 in relation to the public entity concerned as the Auditor-General specifies in the appointment.
52: Section 35 amended (Delegation of powers)
After section 35(2)﻿(a)
aa: the power of appointment of CRD assurance practitioners under section 34A
53: Section 41 amended (Protection from liability)
In section 41(1)﻿(c) or not or an appointed CRD assurance practitioner or neither
54: Section 42 amended (Audit fees)
1: In section 42(1) 15, 15B,
2: In section 42(3) auditor or an appointed CRD assurance practitioner
3: Replace section 42(4)
4: The public entity must pay any fees to the Auditor-General, or to the appointed auditor or the appointed CRD assurance practitioner, on the completion of the whole or any part of the audit or assurance engagement when requested in writing to do so.
2: Related and consequential amendments
55: Related and consequential amendments
1: Amend the Act specified in Part 1
2: Amend the Acts specified in Part 2 2021-10-28 Climate Change Response Act 2002 see s 55(1): in force on day after Royal assent 2022-10-27 Companies Act 1993 Financial Markets Authority Act 2011 Insurance (Prudential Supervision) Act 2010 see s 55(2): in force by first anniversary of Royal assent