In world first, New Zealand to roll out climate change law
WELLINGTON – New Zealand is also set to introduce a law for the first time in the world, making its banks, insurers and investment managers bound to report on the effects of climate change.
The country, which aims at becoming carbon neutral by 2050, stressed that the financial sector needs to come up to play its role in this regard.
Under the law, all banks with total assets of more than NZ$1 billion, insurers with more than NZ$1 billion, and all equity and debt issuers registered with stock exchange will have to report climate-related disclosures.
New Zealand minister for climate change James Shaw, in a statement, said: “We simply cannot get to net-zero carbon emissions by 2050 unless the financial sector knows what impact their investments are having on the climate”.
Legislation is likely to get its first reading this week.
"This law will bring climate risks and resilience into the heart of financial and business decision making," said the minister.
New Zealand's Commerce and Consumer Affairs Minister David Clark expressed, "Becoming the first country in the world to introduce a law like this means we have an opportunity to show real leadership and pave the way for other countries to make climate-related disclosures mandatory”.
The law also aims at ensuring that the effects of climate change are routinely considered in decision taken by business and investment community.
"While some businesses have started publishing reports about how climate change may affect their business, strategies and financial position, there is still a long way to go," said Clark.
The firms will start reporting disclosures in 2023 once the law is approved by the parliament.
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