AICD submission on raising the reporting threshold for large proprietary companies

Raising the reporting threshold for large proprietary companies is a moderate but important measures to provide regulatory relief to a small population of medium sized organisations. AICD Mandala Partners research conducted in 2025 estimates that raising the reporting thresholds to $100 million in revenue and $50 million in assets could save the impacted organisations $710 million over four years.

The automatic adjustment of reporting thresholds that will flow from the Amending Regulations to the climate reporting regime under Part 2M of the Corporations Act 2001 was estimated in the AICD Mandala research to result in a further $1 billion in savings over four years.

The key points in our submission were:

• Application scope: As the proprietary company thresholds are used for both public and proprietary companies, we recommended updating the Explanatory Statement to the Amending Regulations to specify that the updated reporting thresholds also apply to companies limited by guarantee. 

• Financial reporting quality: Informed by member feedback we did not consider that the proposed lifting of reporting thresholds under the Amending Regulations will result in detrimental outcomes in terms of board, investor or broader stakeholder visibility of the financial position of an organisation. The AICD places a strong emphasis in its education and member resources on directors’ obligations for the financial performance, oversight and reporting of the entities they govern.

• Periodic automatic adjustment of reporting thresholds: Over the longer-term, our view is that reporting thresholds should be subject to periodic automatic adjustment, underpinned by public consultation where necessary. Fixed thresholds become outdated due to inflation, economic growth or changes in business structures, resulting in entities being brought within the scope of reporting requirements in circumstances not originally intended by policy makers. 

• Application to Group 3: We strongly recommended that the Government should take the next step and remove Group 3 entities entirely from the climate reporting regime. New AICD Mandala research published in November 2026 estimates that removing climate reporting obligations for the remaining Group 3 firms could save more than $2 billion over four years.

• Application to NFPs: Consistent with the policy rationale for excluding registered charities from the regime, we strongly recommended NFPs more broadly should also be excluded. As with charities, these organisations tend to be resource constrained with a heavy reliance on volunteer support and external funding sources, such as donations and government grants.

• Implementation timing: We strongly recommended that the Government provides policy certainty promptly if it decides that the remaining Group 3 and NFP entities are no longer required to lodge Sustainability Reports, noting the application provisions in Schedule 2 of the Amending Regulations relate to financial years commencing on or after 1 July 2027.