There is growing concern that climate reporting is being over-engineered and over-priced. That pressure is now reaching the suppliers of Australia’s largest companies as Group 1 entities work toward their first Scope 3 disclosures.

Australia’s mandatory climate-related financial disclosure regime began for annual reporting periods starting on or after 1 January 2025, with Group 1 entities reporting first and Group 2 and Group 3 reporting requirements expanding in stages over coming years. Sustainability reports are lodged with ASIC under Chapter 2M of the Corporations Act.

Scope 3 emissions, which sit across the value chains of those Group 1 entities, must be disclosed from the second annual reporting period. In practice, suppliers of all sizes are now being asked for emissions data by their largest customers, regardless of whether the suppliers themselves are direct reporters.

Brisbane-based software company Arteh said suppliers with sound accounting systems were well placed to respond to those requests.

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Arteh has developed an online service to calculate climate liability, and chief executive Thomas Key said small and medium-sized suppliers were being referred to large consultancy firms unnecessarily.

Mr Key said the climate reporting process was relatively simple, with much of the required information already sourced from standard accounting and tax records.

“We use the factors common to all Australian businesses,” he said. “That is, the fuel, electricity and gas that are claimed as deductions.

“It is also repeatable reporting for some businesses. These are the same factors expected as part of the National Greenhouse and Energy Reporting Scheme.

“So the clarity of the software comes from using the inputs that businesses account for in their BAS reporting. The simplicity is that it can be downloaded from the standard accounting packages.”

The reporting framework sits within Australia’s broader sustainability reporting regime, with climate-related disclosures required under AASB S2. The standards have already been introduced for larger emitters and many major listed companies, and the data requests they generate are now flowing through to their suppliers.

Mr Key said most suppliers did not need the help of expensive consultants.

“Can they write a bigger report? Probably. But this doesn’t need a massive report, and this doesn’t need a massive system-wide study.

“The data inputs are relatively simple. The requirements from government, the requirements from investors and the requirements for compliance are very simple. This doesn’t need a giant study.

“It is a simple data input, data output exercise, which is what we’ve developed.”

The Arteh climate calculator is available through the website.

Arteh is a Brisbane-based climate compliance platform. Find out more at arteh.com.au.