New Zealand Scales Back Mandatory Climate Reporting to Support Capital Markets Growth

Key Takeaways

• Narrower Climate Reporting Scope: Mandatory disclosures will apply only to listed issuers above $575 million (NZD 1 Billion) in market capitalization, reducing the regime’s coverage.
• Fewer Entities Affected: The number of climate-reporting entities will drop from 164 to 76, removing 66 listed companies and 22 MIS managers from the rules.
• Compliance Cost Relief: Some companies have spent $1.15 million (NZD 2 Million) on climate-reporting compliance, a major factor driving the Government’s reset.
• Visibility Into Private Assets: From March 2027, KiwiSaver and managed funds must classify private assets by type and location (New Zealand or overseas).

Deep Dive

New Zealand is narrowing the scope of its mandatory climate-related disclosures regime, in a move the Government says will reduce compliance costs for businesses and help restore momentum in the public markets.

The reforms will raise the threshold at which listed companies must report climate risks from $34.5 million (NZD 60 million) to $575 million (NZD 1 billion) in market capitalization, meaning many small and mid-cap issuers will no longer be captured. Managed investment schemes (MIS managers) will also be fully removed from the regime.

The changes would cut the number of climate reporting entities from roughly 164 to 76, and are intended to make compliance more proportionate after feedback showed reporting was imposing costs of up to $1,148,000 (NZD 2 million) per entity, according to Commerce and Consumer Affairs Minister Scott Simpson.

“Mandatory climate reporting has imposed heavy costs on listed businesses,” Simpson said, warning that it has become a deterrent for potential listers. Since 2020, 34 companies have listed on the NZX while 37 have delisted, prompting a broader reset of capital-markets policy.

Capital Markets Reforms Continue

The scaled-back climate reporting requirements are part of a wider agenda aimed at boosting New Zealand’s competitive position for raising capital:

• Listing Relief: From June 2025, companies undertaking IPOs are no longer required to provide forward-looking financial projections, helping reduce listing costs.
• Private Asset Investment Transparency: From March 2027, KiwiSaver and other managed funds must disclose whether private assets are held in New Zealand or overseas, and classify them by asset type, such as infrastructure, unlisted equity, or debt.
• Liability Recalibration: Director and company liability settings will be adjusted to reduce unnecessary risk while ensuring disclosures remain “robust and useful.”

Simpson emphasized that the update retains climate-risk visibility where it matters, and New Zealand’s largest companies will continue to be held to the regime.

“Together, these changes will ensure the right entities are reporting and the regime is not making it harder for Kiwi firms to do business,” he said.

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