FMA extends ‘no action’ relief for certain climate reporting entities
FMA extends ‘no action’ relief for certain climate reporting entities
The Financial Markets Authority (FMA) has extended its ‘no action’ relief for certain climate reporting entities (CREs) while proposed changes to New Zealand’s mandatory climate-related disclosure regime remain uncertain.
The extension will be particularly relevant for:
- Listed issuers with a market capitalisation below $1 billion,
- Managers of registered investment schemes, and
- Health and life insurers.
These entities would be removed from the mandatory climate reporting regime if previously announced Government proposals proceed.
What has happened?
The Government previously announced proposed changes to New Zealand’s mandatory climate reporting regime.
These changes would:
- Increase the market capitalisation threshold for listed issuers from $60 million to $1 billion
- Remove investment scheme managers, including their funds, from the regime, and
- Remove health and life insurers from the regime.
The proposed changes were intended to be progressed through the Financial Markets Conduct Amendment Bill.
However, the legislation required to implement the changes did not pass before the last sitting day of Parliament ahead of the November 2026 election.
This creates an unusual position for affected entities.
The existing legislative climate reporting requirements remain relevant, while there is uncertainty over whether entities affected by the proposed reforms will ultimately remain within the regime.
To address this uncertainty, the FMA has extended its existing ‘no action’ approach.
Which reporting periods are covered?
The extended relief applies to all Part 7A Financial Markets Conduct Act requirements for the first five 2026/2027 reporting periods, covering balance dates from 31 March 2027 through to 31 January 2028.
| Reporting period commencing | Balance date | Climate statement lodgement date | FMA ‘no action’ relief |
|---|---|---|---|
| 1 April 2026 | 31 March 2027 | 31 July 2027 | Yes |
| 1 July 2026 | 30 June 2027 | 31 October 2027 | Yes |
| 1 October 2026 | 30 September 2027 | 31 January 2028 | Yes |
| 1 January 2027 | 31 December 2027 | 30 April 2028 | Yes |
| 1 February 2027 | 31 January 2028 | 31 May 2028 | Yes |
| 1 April 2027 | 31 March 2028 | 31 July 2028 | No |
The existing relief had covered affected CREs for their 2025/2026 reporting periods, with the last balance date covered being 31 December 2026. The latest announcement therefore extends that relief into the subsequent reporting cycle.
Who does the relief apply to?
The relief is aimed at CREs that would cease to have mandatory climate reporting obligations if the Government's previously announced reforms ultimately become law.
This includes:
- listed issuers with a market capitalisation below the proposed new $1 billion threshold
- Managers of registered investment schemes, including their funds, and
- Health and life insurers.
Important to note: the law has not yet changed
Affected entities should note that the FMA's announcement does not itself change the underlying legislation.
A ‘no action’ approach is an indication of how the FMA intends to exercise its regulatory functions.
The FMA explains that it will not take action against a person for breach of the relevant statutory or regulatory obligation while the relief applies.
Importantly, the FMA also cautions that its no-action position does not necessarily prevent third parties from taking legal action in respect of the same conduct.
Accordingly, the relief should not be viewed as equivalent to the relevant entities having already been removed from the statutory climate reporting regime.
What happens next?
The position will depend on decisions made following the November 2026 election.
The FMA notes that if the incoming Government progresses the proposed reforms, it will work with affected CREs to provide further relief if required, having regard to the timing of the reforms.
Alternatively, if the incoming Government does not support passage of the proposed changes, the FMA intends to work with affected CREs on a transition back to climate reporting.
The FMA acknowledges that, in those circumstances, affected entities may be unable to provide comparative information for the preceding reporting year.
What should affected entities be considering?
For entities covered by the FMA's no-action position, the extension provides useful certainty for upcoming reporting periods.
However, it does not yet provide certainty over their longer-term status under New Zealand's climate reporting regime.
In particular, entities considering whether to pause climate reporting processes should distinguish between:
- The requirements of the legislation as it currently stands
- The FMA's regulatory no-action position, and
- The proposed legislative changes (which have not yet been enacted).
There may also be practical reasons for some entities to continue elements of their existing climate reporting processes despite the FMA relief.
These could include information required by investors, lenders, shareholders, parent companies or other stakeholders, as well as maintaining systems and information that may be required if mandatory reporting subsequently resumes.
Entities should therefore consider their individual circumstances before materially reducing or discontinuing existing climate-related reporting processes.
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BDO comment |
Further information
The FMA's announcement is available here.
For more on the above, please contact your local BDO representative.