Group 1 reporters must assess climate resilience against a 1.5°C pathway and a high-warming world. Most first drafts read like marketing. Here's the auditor-proof structure.
AASB S2 requires reporting entities to assess climate resilience using at least two scenarios — one consistent with limiting warming to 1.5°C and one exceeding 2.5°C.
The common first-draft failure is narrative without consequence: scenarios described, but no link to strategy, capital allocation or the financial statements.
An auditor-proof structure: define scenario parameters and time horizons; identify exposed assets, revenues and supply nodes; quantify directional financial effects; state the strategic responses and their triggers.
Remember the liability settings: forward-looking statements enjoy modified liability for the first three years — but only where there is a reasonable basis. Scenario work is that basis.
Disclaimer
General information only — not legal, financial or professional advice. Verify obligations against the current instruments and your entity's circumstances.