Update: Protecting New Zealand’s Competitive Advantage
Chapman Tripp has updated the map and statistics first shared in its Protecting Competitive Advantage report (commissioned by the Circle) and released last year. The update shows a more nuanced and divergent picture than just a year ago with 70% of New Zealand’s export value continuing to go to economies with mandatory climate disclosures.
In April 2024, Chapman Tripp’s Protecting New Zealand’s Competitive Advantage report, commissioned by The Aotearoa Circle, showed that 80% of New Zealand's export value was going to countries with mandatory climate-related financial disclosures (CRD) either already in force or proposed.
Fast forward 12 months and there have been a raft of changes: federal CRD withdrawn in the US, reporting simplified in the EU, and accelerating disclosure requirements in Australia and Asia.
Given XRB’s current consultation on international alignment, Chapman Tripp has revisited its findings for 2025 detailed as follows:
The United States Securities and Exchange Commission has withdrawn its national climate disclosure rule. However, sub-federal regulations in states like California and New York, which receive nearly a third of our US exports, continue to mandate these disclosures. Canada has put its mandatory climate and sustainability disclosure regime on hold for now, pending further developments in the US and international markets.
The EU's Corporate Sustainability Reporting Directive (CSRD) is progressing, though at a slower pace and with reduced reporting requirements. The ‘Omnibus Package’ includes a proposal to limit CSRD’s scope to large companies with more than 1000 employees. Amendments to simplify the European Sustainability Reporting Standards are currently being progressed.
Closer to home, Australia, our closest partner and third-largest export market, has enacted its CRD regime, covering both listed and non-listed entities. 'Group 1' companies are preparing to disclose for the current financial year.
A range of Asian economies are adopting climate and sustainability disclosure requirements based on the ISSB S1 and S2 standards. Notably, China has committed to mandating nationwide ESG disclosures by 2030 and is actively developing national standards, with consultation having closed just last week on a draft climate disclosure standard.
Data indicates that notwithstanding shifts in the US and Canadian approach to CRD, nearly 70% of New Zealand's export value continues to be directed to economies with mandatory CRD either in force or actively proposed. Chapman Tripp’s analysis also showed that, of the countries surveyed in the original report, all (100%) of those that have introduced, enhanced or progressed new disclosure regimes in the last year are in New Zealand’s key export destinations across the Asia Pacific, reinforcing that reporting requirements in our region continue to move forward notwithstanding a more divergent global picture.
*Data Sources: Stats NZ International Trade dashboard, year ending December 2024; US Import and Export merchandise trade statistics; ISSB