Moving past the pilot: Why year two of climate reporting calls for granular, property-level data

The first year of the Australian Sustainability Reporting Standards (ASRS) is nearly complete for major banks. In many of the conversations I’m having across the sector, this initial phase is being treated as something of a pilot. As one client put it: “This year was about getting it done; next year is about doing it well.” However, as ASIC noted in recent reviews, early disclosures frequently missed a critical element: the financial quantification of climate risks.

That shift matters because year two brings more pressure on auditable numbers and the quality of the data behind them.

The shifting reporting landscape

For Group 1 companies, including lenders, the focus now sharpens around two major priorities:

• Financial quantification of climate risks, moving past vague qualitative descriptions
• Scope 3 financed emissions, putting the spotlight firmly on home lenders and their mortgaged properties

On both fronts, data integrity is under the microscope as auditors prepare to apply limited assurance to all elements of the report.

Until now, many banks have relied on top-down calculations and broad postcode averages. But to be credible, and to score well on the Partnership for Carbon Accounting Financials (PCAF) scale, lenders should move closer to the asset itself: the specific property they are lending against.

Beyond compliance: Real-world value for lenders and buyers

This shift is more than just a compliance exercise. At Cotality, we live and breathe property-level insights, and the real value of better data is how it changes the decisions lenders can make every day.

Incorporating property-level information into lending workflows can minimise the hidden costs of postcode-level false positives. For example, relying on postcode data might trigger an unnecessary, costly pre-loan site inspection for a home with a low realistic chance of flooding. Worse, automated rules could filter out a viable property before a conversation even begins. Utilising actual flood incidence data at the property level can help reduce this inefficiency.

For homeowners, the benefits are even more tangible. While granular energy efficiency dataset options give banks a clean baseline for emissions, they also empower everyday Australians. They can help buyers select more efficient homes, and can give banks the insights they need to talk to customers about financing green home upgrades.

That is why I am optimistic about what comes next. Mandatory reporting may have started as a compliance requirement, but it is opening the door to larger, more strategic conversations about mitigating real-world risk, supporting better customer outcomes and building a more resilient property ecosystem. Achieving this requires clear insights, strong financial justification and seamless, customer-friendly workflows.

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