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Farewell from April MackenzieAfter five hugely rewarding and enjoyable years as Chief Executive of the External Reporting Board (XRB), it is time for me to say farewell. Having been a standard setter for much of my career, it is a privilege to end it on a high and retire from this important standard setting organisation. One of the most validating developments of the past five years was the expansion of our mandate in 2021 to include mandatory Climate Related Financial Disclosures and the ability to issue non-binding guidance on non-financial reporting. This accelerated our shift from being process-driven to purpose-driven. I am particularly proud of the He Tauira draft framework we published last week. By engaging effectively with Māori entities, we have developed a world-first non-financial reporting framework on intergenerational impacts. He Tauira supports long-term strategic thinking and encourages entities to consider the future impacts of their actions today. Of course, the quality of our decisions is directly linked to the quality of information we receive from the entities impacted by our work. I, and the rest of the XRB, value the relationships we have built and appreciate the engagement that informs what we do. The trust and confidence we have earned from private sector, public sector, and not-for-profit entities reflects our commitment to accountability, stewardship and transparency. The phrase “punch above your weight” is often used in relation to the XRB and its influence on the international stage. This is particularly borne out by the work of the NZ Accounting Standards Board (NZASB) and NZ Auditing and Assurance Standards Board (NZAuASB), and the staff who work with those boards. Our representation on international bodies including the Accounting Standards Advisory Forum (ASAF), the International Auditing and Assurance Standards Board (IAASB) and the International Public Sector Accounting Standards Board (IPSASB) and our attendance at other forums, is held in high regard. I am sure that the new Sustainability Reporting Board (SRB) will soon also gain this reputation. I have spent the past couple of weeks handing over the reins to the capable hands of Wendy Venter, who takes over as XRB Chief Executive in January. I wish Wendy and the team all the best. Whether I plan to or not, I suspect I will be following XRB’s continued progress with interest - once a standard setter, always a standard setter. Ngā manaakitanga April |
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Differential Reporting The XRB has published a document that provides:
Read more here.
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The XRB is seeking input to a submission to the International Public Sector Accounting Standards Board® in response to its exposure draft of a global public sector climate-related disclosure standard.
The International Public Sector Accounting Standards Board® (IPSASB®) has issued its exposure draft (SRS ED) of the world’s first climate-related disclosure standard for governments around the world.
The External Reporting Board intends to submit a response to the IPSASB’s consultation which is open until 28 February 2025.
Please access the IPSASB climate exposure draft here.
Please reach out to us by 14 February 2025 if you wish to input into the XRB’s submission. Contact the project team at sustainability@xrb.govt.nz or call +64 4 550 2030 to speak with a member of the team.
If you prefer, you are free to submit a response to the IPSASB directly. If so, we kindly request that you inform us of your submission.
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13 November 2024 2024 Climate and Assurance Proposals announcedToday, the External Reporting Board approved three of the four proposals relating to amendments to climate and assurance standards:
The proposal to delay transition planning by an additional year was not adopted, on the basis of hearing strong user demand for this information. The amending standards will be gazetted later this month. The amending standards will have an application date of 1 January 2024, meaning they are applicable for accounting periods that begin on or after this date. Assurance The optional delay in assurance of scope 3 GHG emissions disclosures by one year recognises current data challenges. During the consultation, we heard that systems are rapidly improving, with improvements from data providers expected within the year. We have been discussing with the FMA executive the possibility of a class exemption to provide additional certainty to support the optional delay of assurance over scope 3 GHG emission disclosures. The FMA has advised that it intends to consult on this before the end of the year. We are developing a series of guidance documents to support both the reporting and assurance of the GHG disclosures, in particular scope 3 GHG emissions. The first of these is intended to be released in December 2024. We also intend to publish guidance for users and preparers about how to navigate the assurance report. This will highlight the important aspects of the assurance engagement to help readers understand the level of assurance, scope and the assurance conclusion. Transition planning The XRB Board has decided not to proceed with the proposal to provide an additional year for transition planning on the basis of hearing strong user demand for this information. Transition planning is an iterative and dynamic planning process, and was singled out in the submissions received as a key ‘conversation starter’, both internally and with users. We also heard a strong theme of learning-by-doing, and the XRB notes that this disclosure does not require a fully-fledged, certain and finished ‘plan’. Rather, as some submitters noted, transition plans will be a “work in progress for the foreseeable future” and are an important tool to improve business decision making and capital allocation, therefore strongly contributing to the purpose of the climate reporting regime as a whole. Guidance on getting started on transition planning (published August 2023), and a guide for directors on transition planning (published October 2024), are both available here. More guidance on transition planning, published in conjunction with the Sustainable Business Council, is due to be published in December 2024. |
Previous News and Media Releases
Media Release - 8 October 2024
XRB issues consultation on proposed 2024 amendments to Climate and Assurance Standards
The External Reporting Board (XRB) has today published a consultation document on proposed 2024 amendments to Climate and Assurance Standards.
Significant effort has been applied by climate reporting entities (CREs) and their advisors to ensure the success of the climate-related disclosure regime. Early evidence is that disclosure can improve business decision making and inform capital allocation.
However, the XRB has heard from several sources that CREs are facing challenges with obtaining reliable data, high costs, and how to disclose in the absence of comprehensive guidance on certain topics. There are also concerns about obtaining assurance over scope 3 greenhouse gas emissions disclosures because of difficulties in obtaining sufficient reliable data from up and downstream entities.
In response, the XRB is proposing providing relief by amending:
- NZ CS 2 Adoption of Aotearoa New Zealand Climate Standards
- NZ SAE 1 Assurance Engagements over Greenhouse Gas Emissions Disclosures
Read the Consultation document and Exposure Draft
Consultation closes 30 October 2024
The XRB are mindful of the relatively short consultation timeframe and want to ensure providing feedback is as easy as possible.
Feedback can be provided by:
- Responding to this short survey
- Using the form on the consultation page
- Emailing climate@xrb.govt.nz
We are also hosting daily virtual 'drop in' sessions between 18 - 25 October. As well as providing an overview of the consultation, the sessions will feature an online poll covering key questions from the consultation. Register here to attend.
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For further information contact Emily.marden@xrb.govt.nz
Media Release - 7 October 2024
XRB appoints Wendy Venter as incoming Chief Executive
The External Reporting Board (XRB) today announced the appointment of Wendy Venter as its incoming Chief Executive. Ms Venter will replace April Mackenzie, who announced in August her intention to step down at the end of a five-year term.
Ms Venter is an independent director with current governance and advisory roles with GNS Science, the Nikau Foundation, Stats NZ, Treasury, and Development West Coast and brings deep expertise across governance, risk management, and assurance.
She is also no stranger to the world of standard setting, having been a member of the XRB’s Audit and Assurance Board since July 2022. Previous roles include Partner at EY, Deputy Chief Executive with the Ministry of Social Development and Assistant Auditor-General.
XRB Chair Michele Embling says the appointment follows an extensive recruitment process.
“We are delighted to have someone of Wendy’s calibre and experience join the XRB.
We received a number of high-quality applications, and I’d like to thank everyone for their interest in the position.”
“Thanks to the outstanding efforts of April Mackenzie, who has agreed to stay on to complete the soon to be released climate consultation, Wendy takes up the reigns of an organisation in extremely good health.” added Ms Embling.
Ms Venter will commence in the role on 15 January 2025
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For further information contact emily.marden@xrb.govt.nz
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Biography Wendy is an independent director and consultant with expertise in governance, finance, risk management, organisational change and assurance. She is a former partner at EY, deputy chief executive at the Ministry of Social Development and assistant auditor-general. Wendy is a director of GNS Science, and a trustee of Wellington’s Nikau Foundation. She chairs the risk and assurance committee of Stats NZ and is a member of the Treasury’s Audit Committee for the Government Financial Statements, and Development West Coast's Advisory Body. She is a Fellow of Chartered Accountants Australia and New Zealand and a member of the Institute of Directors, the Institute of Internal Auditors and Global Women. |
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Media Release - 24 September 2024
XRB to issue consultation on transitional adjustments to the climate reporting regime
The External Reporting Board (XRB) has announced that within the month they will publish a consultation document exploring options for transitional adjustments to the Aotearoa New Zealand Climate Standards.
Chief Executive, April Mackenzie says the move is in response to feedback from Climate Reporting Entities (CREs), who have raised concerns regarding certain application challenges.
“With the first wave of Climate Statements now published by many entities (CREs), we’re pleased with the overall level of effort made to meet the objectives of the climate standards. Ultimately, a balance must be found between supporting entities to disclose, while systems, processes and data quality improve over time.” says Ms Mackenzie.
The XRB are now developing options for transitional adjustments to the regime.
This includes looking at what possible arrangements might be put in place to ease certain disclosure and assurance requirements to allow time for improvements in data availability and quality.
A formal consultation document outlining options will be published with a limited period for feedback in order for any possible changes to be implemented by the end of the year.
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For further information contact emily.marden@xrb.govt.nz
Media Release - 19 June 2024
FMA and XRB issue user guides to help users of climate statements
The Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko – and the External Reporting Board – Te Kāwai Ārahi Pūrongo Mōwaho (XRB) – have jointly produced a set of guides designed to help people understand the Climate-related Disclosures (CRD) regime and the information being provided in climate statements which are now starting to be published by climate reporting entities.
The “What You Need to Know” guide provides an overview of the CRD regime for people such as primary users(existing and potential investors, lenders, and other creditors) of climate statements, journalists and other intermediaries who use or communicate climate-related information.
It includes information on:
- the purpose of disclosing climate-related information
- key legislative requirements
- key considerations and context about the information in climate statements
- the roles of the FMA, XRB and relevant government agencies.
The “Navigating Climate Statements” guide is a more detailed explanation of the information disclosed in climate statements. Given that climate statements area new type of disclosure, this guide highlights the importance of topics such as uncertainty, comparability and context when evaluating and judging the information they contain.
XRB Chief Executive, April Mackenzie, said: “We aim for these joint XRB/FMA guides to support the market in getting value from the information contained within climate statements.”
FMA Head of Auditing, Financial Reporting and CRD, Jacco Moison, said: “With reporting now underway and the first climate statements being published, we want to help inform the public of the purpose of the regime.”
View Climate related Disclosure Regime - What you need to know
View Navigating Climate Statements guide
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Notes
The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act2021 introduced a requirement for ‘large’ entities such as listed issuers, registered banks, licensed insurers, credit unions, building societies and managers of registered managed investment schemes (other than restricted schemes) (MIS managers) to publish annual climate statements in accordance with Climate Standards issued by the XRB.
The purpose of the CRD regime is to:
- 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
- Enable entities to show how they are considering those risks and opportunities; and
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Enable investors and other stakeholders to assess the merits of how entities are considering those risks and opportunities.
The Climate Standards state the ultimate aim is to support the allocation of capital towards activities that are consistent with a transition to a low-emissions, climate-resilient future.
The FMA is responsible for monitoring and enforcement of the CRD regime. It will monitor whether climate statements comply with the Financial Markets Conduct Act 2013and the XRB’s Climate Standards.
Annual climate statements must comply with Aotearoa New Zealand Climate Standards(Climate Standards) issued by the XRB. The XRB also prepares guidance to support Climate Reporting Entities (CRE’s) required to prepare climate-related disclosures in accordance with the Climate Standards.
Media contacts:
Andrew Park
FMA Media Relations Manager
andrew.park@fma.govt.nz
021 2206770
Emily Marden
Head of Communications and Engagement
The External Reporting Board
emily.marden@xrb.govt.nz
Media Release - 18 June 2024
XRB Standards go Digital
Chief Executive of the External Reporting Board (XRB), April Mackenzie says New Zealand has taken a significant step towards modernising external reporting with the launch of a digitised reporting and assurance standards platform. The XRB Standards Navigator takes static PDF versions of XRB standards and presents them in a more accessible, dynamic and user- friendly format.
“External reporting is critical to ensure transparent and consistent reporting and the ability for stakeholders such as shareholders, investors, donors and tax-payers to hold organisations accountable and the XRB Standards Navigator will, for example, make it simpler, faster, and more straightforward for entities to undertake their reporting.” Said Ms Mackenzie
The tool makes finding standards and related material much easier for reporting entities by allowing them to navigate them in a seamless way. Definitions can be pinned for quick reference and a sorting feature means users can identify standards by name, application date, and reporting sector.
Chair of the XRB, Michele Embling says the development of the XRB Standards Navigator has been a collaborative effort involving reporting entities’, and auditor’s, themselves.
"In time, this tool will serve as the central hub for all XRB announcements, amendments, and guidance, ensuring that it remains at the forefront of reporting and assurance resources," Embling added.
The XRB Standards Navigator can be accessed here: https://standards.xrb.govt.nz/standards-navigator/
For further information contact Emily.marden@xrb.govt.nz
We have also produced the following short explainer/promotional video to accompany the release, link here.
Media Release - 4 June 2024
XRB Chief Executive announces end of 5-year term
The Chief Executive of the External Reporting Board (XRB), April Mackenzie has announced her decision to leave the organisation towards the end of the year ending her 5-year tenure in the role.
XRB Chair Michele Embling said Ms Mackenzie has done an outstanding job as the XRB’s Chief Executive.
“April has been an exceptional leader of the XRB and leaves a lasting legacy. Under her leadership the XRB achieved a major milestone by issuing the Aotearoa New Zealand Climate Standards as well as transformed how the XRB operates, collaborates with our stakeholders and delivers overall,” said Ms Embling.
The Board and Ms Mackenzie are working towards a departure date of later in 2024 but will take a flexible approach to the timing in order to ensure a smooth transition.
Ms Mackenzie said she had enjoyed her time at the XRB.
“It has been a privilege to serve as Chief Executive at a time which has seen substantial growth in the organisation and the introduction of some significant new reporting areas.
I’d personally like to thank the XRB Board and staff for their unwavering support throughout my term as CE.” said Ms Mackenzie.
The XRB has appointed Inside Recruitment to assist with the search for a new Chief Executive.
For further information contact Emily.marden@xrb.govt.nz
Biography
April joined the External Reporting Board (XRB) as Chief Executive in December 2019 and has been responsible for leading the organisation to achieve its mission and strategic objectives.
This has included oversight of the XRB's operations, people, policies, processes, and governance. April has extensive experience in external reporting and standard setting both in New Zealand and internationally.
15 December 2022
Landmark moment in New Zealand’s transition to a low-emissions future
Today, Michele Embling, Chair of the External Reporting Board (XRB), has announced that the Climate-related Disclosures standards have now been published.
Around 200 of New Zealand’s most economically significant entities will start reporting against the standards from 1 January 2023. Reporting on climate-related risks and opportunities is largely still in its infancy, but Ms Embling believes having formalised reporting standards will build momentum and catalyse change.
“By providing investors with the information they are increasingly demanding, such as a company’s greenhouse gas emissions, the reporting regime will help to drive capital towards activities that support the transition to a low-emissions future. It will also galvanise directors and management to start looking closely at their climate-related risks and opportunities and what strategies and plans they have in place to manage them.” Says Ms Embling
The reporting standards have been developed through three consultative iterations over the past 18 months according to the XRB’s Chief Executive, April Mackenzie.
“The level of active engagement on this work has been impressive. New Zealand organisations and individuals are clearly and rightfully very passionate about this topic. We are immensely grateful to everyone who got involved in this work and provided feedback—we couldn’t have done it without them.”
Ms Mackenzie says a number of changes to the draft standards have been made following the last round of consultation.
Find Aotearoa New Zealand Climate Standards here.
Media contact: Emily.marden@xrb.govt.nz 0274140340
Media statement - 21 October 2022
New Zealander appointed to the International Auditing and Assurance Standards Board
The Chief Executive of the External Reporting Board (XRB), April Mackenzie has today announced the appointment of Greg Schollum, Deputy Controller and Auditor-General to the International Auditing and Assurance Standards Board (IAASB) for a three-year term.
The IAASB is an independent standard-setting body that works to strengthen public confidence in the global auditing and assurance profession. Appointments to this Board are made through nominations to the Public Interest Oversight Board who announced successful nominations earlier today.
“We are delighted that Greg’s nomination has been successful. As well as contributing to the development of high-quality audit and assurance standards, Greg will bring a strong public interest focus to the work, emphasising the needs of users in the standard setting process and ultimately increase the trust and confidence of users of audited information.
With former Auditor-General Lyn Provost ending a six-year term from the Board, it’s pleasing to still have a New Zealand voice involved in the development of international auditing and assurance standards. Greg will be an asset to the IAASB with his decades of auditing and standard-setting experience”, said Ms Mackenzie.
Greg has been New Zealand’s Deputy Controller and Auditor-General since 2015 and has more than three decades’ experience in auditing and standard setting, with a particular focus on setting accounting and audit and assurance standards. Greg has previously been New Zealand's representative on the International Public Sector Accounting Standards Board, a member of the New Zealand Accounting Standards Board and the Financial Reporting Standards Board of the New Zealand Institute of Chartered Accountants.
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Media contact: Emily.marden@xrb.govt.nz 0274140340
28 July 2022
Shedding sunlight on climate risks and opportunities
Today the External Reporting Board (XRB) has released their final consultation on the Climate related Disclosure standards which around 200 of New Zealand’s largest entities will need to report against from next year.
Development of the reporting regime followed the Government’s announcement of its intention to introduce a world-first mandatory climate reporting regime. Currently, New Zealand’s largest entities provide limited information on how climate change could impact their future operations.
XRB Chief Executive April Mackenzie says today’s release is a significant milestone towards ensuring the effects of climate change are actively and routinely considered in business, investment, and lending decisions.
“Climate disclosures bring climate-related risks and opportunities front and centre so that entities are prompted to think about their strategy and business model and assess whether they can continue to create value in the long term, or whether they need to adapt.”
Mackenzie stresses that investors and shareholders are increasingly demanding greater transparency through the disclosure of climate-related risks and opportunities.
“The disclosures are about transparency and trust. These sit at the heart of decision making—for investors and the entities themselves.
Ultimately, it’s about driving investment and capital away from high-emissions activities and towards low-emissions activities. We are confident the disclosure regime we’ve developed will support that transition.” says Mackenzie.
The XRB’s consultation closes 26 September 2022 – further information can be found here.
Media contact: Emily.marden@xrb.govt.nz 0274140340
5 April 2022
XRB appoints ESG specialist as Chair of Auditing and Assurance Standards Board
The Chair of the External Reporting Board (XRB), Michele Embling has today announced the appointment of Marje Russ as Chair of the XRB’s Auditing and Assurance Standards Board. Ms Russ will replace outgoing Chair Robert Buchanan who ends a 6-year tenure as Chair at the end of June.
“We’re extremely grateful for Robert’s years of dedication and the public interest focus he brought as Chair and are delighted to welcome Marje into the role,” says Ms Embling.
Ms Russ has been a member of the XRB’s Auditing and Assurance Standards Board since 2013 and previously represented the XRB as an advisory panel member on the International Auditing and Assurance Standards Board’s project to develop guidance on Extended External Reporting (EER), which was published in April 2021.
Ms Russ has a background in environmental and resource management with expertise in environmental planning/policy-setting, environmental certification and assurance, and risk management and governance.
Ms Russ stepped down from an 11-year Board Director position for Tonkin & Taylor Group Ltd in 2021 and continues in a consulting role as Technical Director Environment and Sustainable Business. She has recently been appointed to the board of Manaaki Whenua: Landcare Research.
For further information about the XRB and the Auditing and Assurance Standards Board, click here.
16 March 2022
New Zealand a step closer towards Climate reporting
Today, the External Reporting Board has released the second part of the Climate-related Disclosure standards for public consultation. This release focuses on Strategy, and Metrics and Targets which combined, outline how entities need to assess current and future climate risks and opportunities and report on corresponding financial implications.
“These are challenging but critical topics that will require reporting entities to think about developing and implementing new processes,” says XRB Board Chair Michele Embling.
The Strategy section looks at the impacts of climate risks and opportunities on an entity’s business model, strategy and financial planning over the short, medium, and long term, including actual and potential financial impacts.
“Entities will need to look at various possible future scenarios and test the resilience of their business model and strategy to form a realistic picture of potential future performance.
The proposed Targets and Metrics section details how entities will report on measuring and managing climate risks and opportunities.
“These disclosures will mean information users, such as investors, will have sight of an entity’s potential risk-adjusted returns, their ability to meet financial obligations, and have a good idea of how they are managing or adapting to climate risks and opportunities.” Added Ms Embling
The FMA, who are responsible for compliance and enforcement of the reporting regime, has signalled realistic expectations in its implementation approach.
“We recognise that reporting entities won’t achieve perfection on day one, so our compliance expectations will be focused on supporting entities to meet the new reporting requirements”, said FMA Acting Director of Capital Markets Paul Gregory.
Development of the climate reporting standards follows the announcement in 2020 to introduce a mandatory reporting regime for key New Zealand companies including large, listed issuers and financial sector entities.
Consultation closes 13 April.
See the consultation document here.
The launch slides are unavailable.
Media contact: Emily.marden@xrb.govt.nz 0274140340
Editor's note: The closing date for the consultation has subsequently been changed to 2 May 2022.
20 October 2021
First ever Climate Change-related disclosure consultation begins
The External Reporting Board (XRB) today began consultation with business on the first part of the Government’s proposed climate-related disclosure standards.
“Ultimately, this will be about making sure the impacts of climate change are actively considered by boards and management so that smarter business and investment decisions can be made, and entities demonstrate accountability and foresight in relation to climate issues,” says Chief Executive April Mackenzie.
Development of these standards follows the announcement in 2020 to introduce a mandatory reporting regime for key New Zealand companies including large, listed issuers and financial sector entities.
“These standards will put Aotearoa New Zealand up with the global best - building on the four areas developed by the international Task Force on Climate-related Financial Disclosures (TCFD).
“Together Governance, Risk Management, Strategy, and Metrics and Targets sections make up the Climate-related disclosure standards, and we’re kicking off the process with consultation on the Governance and Risk Management areas.”
The decision to focus first on Governance and Risk Management has been deliberate, says Mackenzie.
“For affected entities these areas should be straightforward to implement, whereas the Strategy, and Metrics and Targets sections are more complex areas that will require many entities to capture new information and implement new processes. We’re currently working through what that could look like before launching the next draft sections in March next year,” added Mackenzie.
Governance disclosures specify what entities need to disclose regarding board oversight and management assessment of climate-related risks and opportunities, while Risk Management disclosures are about the processes an entity uses to identify, assess, and manage climate-related risks, and how these are integrated into an entity’s overall risk management processes.
The current consultation closes 22 November.
17 June 2021
XRB appoints Climate Policy expert
Media Release
Today Chief Executive of the External Reporting Board, April Mackenzie, has announced the appointment of Dr Amelia Sharman as Director of Climate Reporting. Dr Sharman will be responsible for managing the execution and co-ordination of the Climate-related Disclosure Standard(s) project.
“I am delighted that Amelia will be joining us at the XRB to lead this important work. She brings a wealth of climate expertise and experience to this role, and I look forward to welcoming her into our management team,” says Mackenzie.
“This is a priority project for the XRB, and we’re proud to be part of taking New Zealand a step closer towards a low carbon future.
I’d also like to thank the many high-calibre candidates who expressed an interest in this role”, says Mackenzie.
Dr Sharman has an extensive background in climate and sustainability policy areas, most recently as Head of Policy at Ara Ake, the entity responsible for accelerating energy innovation to support New Zealand's transition to a low-emissions energy future. Previously, Dr Sharman worked for the New Zealand Productivity Commission contributing to climate and sustainability reports on New Zealand’s transition to a low-emissions economy. Most notably, Dr Sharman was at the forefront of the Commission’s analysis into climate-related financial disclosures, and subsequently developed the Commission’s final recommendation on the disclosure regime for New Zealand.
Dr Sharman will join the XRB on 28 June 2021.