Corporate Australia should start preparing for incoming climate disclosure laws, Australian Securities and Investments Commission (ASIC) Chair Joe Longo says.

He says more than 6000 businesses will have to comply with the new requirements in the next few years.

“You have to do this now. It’s simply not an option to put this off until after legislation has passed, and then scramble to comply,” he told a sustainability forum last week.

“You have to figure out how you’re going to marshal data, support and capabilities, and start keeping the necessary records now, today.”

Legislation proposing mandatory climate-related disclosure was introduced to Parliament last month and the Australian Accounting Standards Board recently consulted on an exposure draft of the Australian Sustainability Reporting Standards.

Preparing early will allow for the “best transition” to the regime, which will be administered by ASIC, Mr Longo says.

“It will provide a surer foundation for a more profitable business, because a compliant business is a profitable business.”

Growing interest in environmental, social and governance issues is driving the biggest changes to financial reporting and disclosure standards in a generation.

“The data tells us markets and investors are increasingly relying on this information to make decisions,” Mr Longo said. “That’s why climate and sustainability disclosures and statements need to be rigorous, robust and comprehensive.

“And it should go without saying, they cannot be misleading or deceptive under law. This is nothing new – it has never been OK to be misleading or deceptive.”

He says ASIC will take a pragmatic approach to supervision and enforcement of the climate reporting regime.

“We will consider what support and guidance we can give to help entities meet their new obligations. In short, I want to make it clear that ASIC is listening.

“We know there are a lot of moving parts, we understand the complexity and the challenge, and we’re here to administer the new standards in a way that benefits us all.”