In June 2026, the Science Based Targets initiative (SBTi) released version 2.0 of its Corporate Net-Zero Standard — its most significant update in five years. 

SBTi release of Corporate Net-Zero Standard Version 2.0

The update comes as businesses are already grappling with mandatory climate reporting aligned to IFRS S2, making it increasingly important to understand how voluntary net-zero standards fit within the broader reporting and transition planning landscape.

At its core, v2.0 signals a shift from ambition to action: from defining credible net-zero targets to governing credible net-zero delivery. It responds to growing SBTi adoption and practical concerns about target delivery, particularly across Scope 3, by placing greater emphasis on implementation, governance, capital allocation, supplier engagement, transition planning and best-efforts progress over time.  

So, what do these updates actually mean for businesses navigating an increasingly complex climate reporting landscape? 

From commitment to action – what’s new in v2.0? 

SBTi v2.0 introduces a number of technical changes, but for businesses, the practical implications can be understood through six work-streams: 

1. Company categorisation and target architecture 
V2.0 introduces a two-tier structure based on company size and country income classification. Category A captures large companies globally with revenue ≥ $736 million AUD* and ≥ 1,000 full time employees (FTE), and medium-sized companies in high-income countries with at least two of the following: balance sheets ≥ $40 million AUD*, net turnover ≥ $80 million AUD* and/or FTE ≥ 250. Category B captures any companies globally that do not meet the previously outlined thresholds. For most Australian businesses of meaningful scale, Category A requirements are likely to be most relevant, including Scope 3 target-setting, transition plan disclosure and limited assurance over base-year data. 

 * Converted from European euro using RBA exchange rate as at 22nd June 2026: https://www.rba.gov.au/statistics/frequency/exchange-rates.html  

2. Governance and transition planning 
Transition plans are now central to validation and delivery. All companies must explain how targets will be implemented, including actions, timeframes, assumptions and dependencies. Category A companies must disclose their transition plan, with flexibility to publish within 15 months of validation. 

3. Base-year data and assurance 
Targets must use the latest available target base-year data rather than older historical baselines. Category A companies must obtain limited assurance over base-year emissions data, strengthening the link between SBTi target-setting, climate reporting and assurance readiness. 

Scope 1: A new asset transition pathway has been added alongside absolute reduction and sector-based intensity approaches. This is particularly relevant for capital-intensive businesses with long-lived assets. 

Scope 2: Targets can be based on emissions reduction and/or low-carbon electricity share, with delivery through instruments such as power purchase agreements (PPAs), contracts for difference and renewable energy certificates (RECs). V2.0 adds rules on deliverability regions, contract vintage, grandfathering of existing contracts and hourly matching disclosure. 

Scope 3: Near-term targets are mandatory for Category A and optional for Category B, with justified exclusions permitted. Three pathways are available:  

overarching emissions reduction, including reduction to residual emissions of approximately 10% or less by 2050 or sooner; 

category- or activity-specific targets. 

5. Implementation hierarchy and market instruments 
V2.0 prioritises direct action within operations and value chains, then shared-system actions such as grids, logistics networks or supply sheds, and finally sector-level actions where direct levers are constrained. Market instruments, including energy attributes, RECs, largescale generation certificates (LGCs) and commodity certificates may support delivery where they meet integrity criteria and guardrails. 

6. Best efforts and ongoing emissions responsibility 

V2.0 introduces a clearer “best efforts” model. Companies must use available levers, disclose barriers and dependencies, and show how these are being addressed over time. The Standard also introduces Ongoing Emissions Responsibility (OER), a voluntary recognition program covering 1% to 100% of ongoing emissions, with SBTi signalling an intention to mandate OER from 2035. Carbon credits and other climate contributions do not satisfy near-term targets, and residual emissions must still be neutralised at the net-zero target year. 

What does this mean for IFRS S2 and ASRS reporters? 

With the rollout of IFRS S2 and AASB S2, many businesses are asking how SBTi v2.0 fits into their mandatory climate reporting obligations. The key point is that target-setting is not a direct requirement of IFRS S2 or AASB S2, and businesses are not required to have their targets validated by SBTi. However, where climate-related targets have been set, reporters must disclose information about those targets, including the methodology, metrics used to assess progress, and performance over time. 

This is important because target-setting expectations are likely to evolve as climate reporting matures. Best-practice reporters are already setting emissions reduction targets irrespective of S2 requirements, and where targets exist, the credibility of the underlying methodology will face increasing scrutiny as reporting and assurance expectations tighten. SBTi remains one of the most recognised third-party mechanisms for science-based target validation, supported by growing market uptake, including SBTi’s reported 40% increase in companies with validated targets in 2025. 

For businesses, the practical implication is that SBTi validation is not mandatory, but it may become increasingly relevant for credibility, comparability and stakeholder confidence. As more companies disclose quantitative support for public emissions-reduction commitments, SBTi-aligned targets are likely to become a more important reference point for demonstrating that climate ambition is credible, measurable and aligned with the science. 

Signal shift towards action emphasises the need for a transition plan 

One of the most significant updates under SBTi Corporate Net-Zero Standard v2.0 is that companies submitting targets are now required to develop and maintain a transition plan. This reinforces a broader shift in the Standard: credible climate action is no longer just about setting a target; it is about demonstrating how that target will be delivered. 

Under v2.0, transition plans must explain how science-based targets will be implemented, including actions, timeframes, assumptions and dependencies. For Category A companies, public disclosure is also required, with flexibility to publish within 15 months of target validation. The Standard also links credible implementation to highest-level governance oversight, review mechanisms, and integration with corporate strategy and decision-making. 

For businesses, transition planning should not be treated as a sustainability document prepared after targets are set. It is becoming part of the operating architecture for credible climate strategy, linking emissions pathways to governance, strategy, capital allocation, procurement, value-chain engagement, progress monitoring and climate disclosure. In Australia, this is reinforced by ASRS: AASB S2 does not require every company to have a transition plan, but where one exists, companies must disclose information about it, including assumptions, dependencies, resourcing and progress. 

Why v2.0 matters for heavy industry and hard-to-abate sectors 

SBTi v2.0 has relatively positive implications for heavy industry and hard-to-abate sectors because it is more implementation-aware, asset-aware and system-aware, while still requiring credible decarbonisation action. This is particularly relevant in Australia, where industrial decarbonisation is often shaped by long-lived assets, major capital investment, renewable electricity availability, low-carbon fuels, enabling infrastructure and technology maturity. 

A key change is the new Scope 1 asset transition pathway, which allows companies with long-lived or capital-intensive assets to set targets linked to transition plans, asset replacement cycles, phase-out milestones and carbon budgets. Sector-specific emissions-intensity pathways also remain important where available, including for sectors such as steel, cement and chemicals. 

For heavy industry, v2.0 also means targets need to be linked to capital allocation, maintenance cycles, electrification, fuel switching, process changes, supplier engagement and infrastructure dependencies. Where significant emissions-intensive activities are present in the value chain, companies must also develop a plan to decarbonise those emissions. 

The Standard still requires science-aligned ambition: direct decarbonisation remains the priority, while shared-system and sector-level actions may be used where direct levers are constrained. Market instruments may support delivery where they meet integrity criteria, but claims need care. Carbon credits and other climate contributions do not satisfy near-term targets; residual emissions must still be neutralised at the net-zero target year. 

Manuel Pulgar-Vidal, WWF global lead for climate and energy

“This next generation of the SBTi Net-Zero Standard marks a significant step forward in aligning corporate climate ambition with real-world delivery.”

Already set targets, or setting them now? What to prioritise next 

The release of SBTi v2.0 and the rollout of mandatory climate reporting under AASB S2 are not isolated developments. Together, they form part of a broader shift in how climate ambition is defined, disclosed and held to account.  

The good news is that the v2.0 transition is not immediate. Existing v1.3.1 targets are not automatically invalidated, and version 1 remains open for setting targets until the end of 2027.  

But that runway should be treated as planning time, not waiting time. If you are currently developing targets, designing them with v2.0 in mind can help avoid costly restructuring later.  

If you already hold SBTi-validated targets, the priority is a structured gap assessment. And if you do not currently have targets, now is the time to consider whether, and how, science-based targets fit into your longer-term climate disclosure and transition strategy. 

For Category A companies under the new Standard, three priorities stand out: 

Review or develop your transition plan. Under v2.0, this becomes central to target delivery and should set out the actions, timeframes, assumptions and dependencies that support your targets. For Australian businesses, this also links to ASRS reporting, particularly where transition plans, capital allocation and progress may need to be disclosed. 

Review your latest target base-year emissions dataset. Assess whether it is complete, traceable and limited-assurance ready. This can align with the broader data quality and assurance uplift many businesses are already undertaking for climate reporting. 

Test your existing targets against the new Scope 1, 2 and 3 pathways. This is especially important where the new asset transition pathway may be relevant for Scope 1, where electricity procurement approaches may affect Scope 2, or where supplier/customer alignment and category-specific pathways may provide a more practical approach to Scope 3. 

The message is not panic, it is prepare: use the runway to strengthen transition planning, data quality and target architecture before disclosure, assurance and target-setting expectations converge.

SBTi v2.0 is best understood as an action framework. Compared with v1.3.1, it shifts the focus from defining credible net-zero targets to governing credible net-zero delivery. 

The previous Standard asked: “What does a credible corporate net-zero target look like?” v2.0 asks a broader question: “How does a company credibly govern, implement, evidence and strengthen its transition toward net-zero?” 

SBTi validation is becoming less about the target in isolation, and more about the delivery system behind it. Those that use v2.0 to strengthen governance, transition planning, data quality, capital allocation and value-chain engagement will be better positioned as target-setting, disclosure and assurance expectations continue to converge. 

For organisations ready to move beyond reporting and deliver lasting change, Edge Impact combines science, strategy and storytelling to support boards and executives to navigate with confidence. 

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Group 2 entities have one clear advantage: they can learn from the first wave of Group 1 reporters. Those early experiences show that AASB S2 reporting requires governance, risk, finance, strategy and operations to come together early, with COOs, CFOs and executive teams playing a critical role. 

Group 2 AASB S2 reporters: What executive teams should learn from year one

AASB S2 sits on the CFO and COO's desk now, not just sustainability's.

Group 2 AASB S2 reporters: What executive teams should learn from year one 

For many CFOs, COOs and executive teams, this is a new responsibility. To manage it well, there are a few key issues to be across early. 

Group 2 applies to entities that meet at least two of three thresholds: more than 250 employees, consolidated gross assets of $500 million or more, or consolidated annual revenue of $200 million or more. It also captures asset owners with $5 billion or more in assets under management, and any entity that is already an NGER Scheme controlling corporation. 

Group 2 entities have one clear advantage: they can learn from the first wave of Group 1 reporters. Those early experiences show that AASB S2 reporting requires governance, risk, finance, strategy and operations to come together early, with CFOs and executive teams playing a critical role. 

Group 2 reporting under AASB S2 starts for financial years beginning on or after 1 July 2026.

Here are six areas senior leaders should have on their radar:

AASB S2 is principles-based, so judgement is expected. In practice, there can be a gap between the wording of the standard and how it is interpreted. Auditors across the market are still working through how to apply it consistently, sometimes even within the same firm. 

Group 2 entities should engage auditors early to test the proposed approach and clarify what auditors will expect in terms of evidence, documentation and supporting artefacts. This is especially important where the entity expects to rely on proportionality mechanisms, qualitative disclosure or staged uplift, since these are areas likely to be questioned. 

Waiting until pre-assurance may leave limited time to fix gaps. By then, the issue may not be whether the disclosure can be written, but whether the process behind it can be evidenced well enough to avoid a qualified audit report.  

1. Engage auditors early, not just at pre-assurance 

Many organisations initially view governance as an easy win. Most already have boards, committees, risk processes and executive accountabilities. In practice, climate disclosure governance often takes longer than expected. 

The issue is not whether governance structures exist but whether climate-related risks and opportunities are formally embedded into decision-making structures and processes. 

This may require board and committee charters, audit and risk committee terms of reference, executive position descriptions and reporting calendars that reference climate explicitly, along with evidence of how climate is factored into strategy, risk management, capital allocation and financial planning. 

This should not be reconstructed retrospectively, so uplift work needs to be substantially complete in the first six months of the reporting year. 

2. Governance needs evidence, not just a simple structure 

Climate risk assessment has similarities with traditional enterprise risk assessment, but treating it as the same process can create problems. 

Climate-related risks are often longer term, more uncertain, scenario-dependent and require greater coverage across the value chain. A tailored method should be developed early. For many entities, this means an initial screening followed by a more detailed assessment resulting in a climate risk register. Ideally this would be completed in the first six months of the reporting year, laying the foundation for quantification later. 

Recent floods, bushfires, cyclones or energy market shocks, while relevant, should not dominate simply because they are front of mind. Climate risk is forward-looking and assessments that lean too heavily on recent events or historical data may miss longer-term, slow-onset or compounding risks. 

3. Climate risk assessment is not enterprise risk assessment with a new label 

A central focus of climate disclosure reporting is whether material climate-related financial risks and opportunities exist or can be reasonably expected, as has been discussed in the recent International Auditing and Assurance Standards Board (IAASB) guidance on the application of materiality under the International Standard on Sustainability Assurance (ISSA) 5000. 

Executive teams should discuss materiality early, even if the final definition or application is not settled until drafting the disclosure report. Left unresolved, materiality becomes a recurring argument: a risk gets identified, its relevance gets debated, the scoring approach gets revisited, and the same discussion resurfaces once drafting begins. 

Materiality needs to reflect what the board and management consider material, but also what a reasonable reader may expect to be material. This distinction matters where management sees a risk as low priority, but investors, lenders, insurers or other stakeholders may reasonably expect it to be addressed. Settling this at the executive level early, even loosely, prevents it from becoming a bottleneck later. 

4. Define materiality well before drafting starts

Reporting entities may initially expect to rely on proportionality mechanisms such as undue cost or effort, or uncertainty in underlying data to avoid quantifying risk. In some cases, that may be appropriate. But year one has shown that entities still need to do the groundwork before they can support that conclusion. 

What is no longer sufficient, as ASIC's June observations on sustainability reporting made clear, is simply asserting that quantification was too hard. 

Entities need to show they explored the available calculation methods, understood what data existed and what did not, and considered what assumptions a credible estimate would require. Ideally this should start three to six months ahead of reporting. 

Where quantification cannot be completed in year one, entities should still leave enough time to prepare robust qualitative disclosures. A weak quantitative estimate is not necessarily better than a strong qualitative disclosure, but a qualitative disclosure still needs evidence behind it. 

5. Deciding whether and how to quantify requires a thorough process 

Climate disclosure reporting is cross-functional, but the required skill set will likely change across the reporting cycle. 

Early in the reporting year, the work often relies on subject matter expertise from operations, assets, procurement, strategy, risk, finance, sustainability and governance. These teams are needed to understand the value chain, identify risks and opportunities, test assumptions and assess exposure. 

As the year progresses, the focus usually shifts towards governance, finance, reporting, evidence, disclosure drafting and assurance readiness. CFOs and finance teams become especially important at this point. 

Climate disclosure is not a sustainability workstream that gets handed to finance at the end, nor a finance-led reporting exercise that can be completed without operational insight.

The advantage for Group 2 is time 

Group 2 entities can learn from the first wave of reporters. That advantage could be lost if the first reporting year is treated as a compliance project that can be accelerated near the end. 

The harder parts of AASB S2 are the judgement calls, evidence trails, governance uplift, risk assessment methods, quantification pathways and cross-functional decisions that sit underneath the final disclosure. 

By bringing the right people in early and ensuring the CFO and executive team are close to the assumptions, judgements and implications behind the disclosure, Group 2 entities can turn AASB S2 from a reporting obligation into an opportunity to strengthen decision-making, resilience and confidence in their climate response.

6. The skills required will change across the year 

Dr Mark Siebentritt is the Executive Director of Climate and Sustainability at Edge Impact, with over 25 years of experience in sustainability services, including 17 years specialising in climate risk and adaptation. His focus on combining technical rigour with stakeholder engagement helps organisations make more informed and practical climate-related decisions.

Interested in a complimentary review to start your AASB S2 reporting? Contact us

Essential insights for board members on climate governance. Learn about understanding climate risk, managing timelines, and embracing uncertainty. Read now for proactive governance in addressing climate change challenges.

Navigating Climate Governance: What Every Board Member Should Know

Written by 
Mark Siebentritt, Executive Director

Navigating Climate Governance: Board Members

While this responsibility has been a constant, the emergence of climate change as a critical factor requires directors to tread new ground. 

With 20 years of experience in public and private sector governance, including 15 years dedicated to delivering climate risk processes, I believe that there are crucial aspects of climate governance that every board member should be well-versed in. 

In the fast-evolving landscape of corporate governance, directors are tasked with safeguarding the best interests of their businesses. 

Whether through the identification of specialised expertise or upskilling for all directors, the need for climate governance proficiency is undeniable and has been emphasised by professional bodies such as the AICD.

Climate risk, akin to regular risk, has two main forms: physical risk and transition risk. 

The former encompasses the risks associated with a changing climate, including heatwaves, floods, and bushfires. 

On the flip side, transition risk involves the challenges of moving toward a low-carbon economy. Directors must comprehend the nuances of both and assess their organisation's vulnerability. Despite their distinctiveness, these risks inevitably trickle down to impact strategic, financial, and operational aspects.

Timeframes and Decision Lifetimes: Deciphering the Puzzle

The timelines for climate risk assessment and response planning differ significantly from traditional business planning. Physical risks unfold over decades, presenting a unique challenge for directors.

The decision lifetimes approach becomes a valuable tool, acknowledging that decisions made today have varying spans. Directors must consider the longevity of decisions, from the choice of electrical equipment in a tolling booth to the construction of bridges on a highway, with the latter spanning 80-100 years. 

This perspective guides the incorporation of long-term climate change into current decision-making processes.

Understanding Climate Risk: More than Just a Coin Toss

We have released a Discussion Paper titled, 'How to Thrive in the New Era of ESG Disclosure" to help organisations understand and navigate the complexities of the future ESG disclosure landscape. Download it here.

Living with uncertainty is a fundamental aspect of climate governance. The ever-changing landscape of future climate conditions, influenced by global emissions reduction policies and unpredictable climate responses to greenhouse gases, demands a proactive approach.

Embracing Uncertainty: The Role of Scenarios

Directors can embrace uncertainty through scenario thinking, a core element of climate disclosure strategies outlined in TCFD requirements. Familiarising themselves with multiple scenarios enables directors to navigate the unpredictable nature of climate change with resilience.

Building the Evidence Base: An Iterative Approach

For businesses embarking on their climate risk journey, there is no one-size-fits-all formula to precisely gauge the financial impact of future risks. 

An iterative approach involving risk screening, enterprise-level risk assessment, and the development of specific financial impact models is essential. Drawing from past and current hazards, such as floods and heatwaves, provides valuable data to build a robust evidence base over time.

Aligning with ISO31000: Recognising the Differences 

While aligning climate risk assessments with ISO31000 is considered a leading practice, directors must recognise the subtle yet crucial distinctions. Adaptation measures, aimed at reducing climate risk vulnerability, take center stage in climate risk assessment. 

Unlike traditional risk assessment, which considers only current conditions, climate risk assessment prompts directors to evaluate risk changes over multiple decades. 

As we collectively address the challenges of climate change, informed and proactive governance will be the key to success. Read more about our climate change services here.

Learn how to Thrive in the New Era of ESG Disclosure with our latest Discussion Paper. Read it here.

By embracing a tailored, dynamic, and integrated approach to metrics, businesses can navigate the challenges of climate risks while contributing meaningfully to a sustainable future. Read more.

Metrics that Matter: Guiding Climate Action Through Informed Decision-Making

Guiding Climate Action Through Informed Decision-Making 

As pressure mounts from both shareholders and stakeholders to address environmental concerns, the need for evidence-based decision-making becomes imperative. Beyond being a good practice, it is also a requirement for climate disclosure reporting.

Here are 6 key considerations to help guide your climate action decisions:

1. Understanding Thresholds and Tipping Points: A Time-Strategic Approach

Effective response to climate change requires a strategic approach that spans both short and long-term actions. The key lies in identifying thresholds and tipping points, pivotal moments that indicate the need for immediate action.  

By monitoring specific metrics, such as the occurrence of floods in successive years at a particular location, organisations can anticipate potential asset failures and allocate investments accordingly. This proactive approach not only mitigates risks but also spreads financial commitments over time, avoiding upfront financial strain.

2. Tailoring Metrics for Diverse Climate Risks: Physical vs. Transition 

Not all climate risks are created equal, and recognising the differences between physical and transition risks is crucial. Metrics and targets should be specifically designed to address each type of risk. For instance, physical risk metrics might focus on observable changes, such as extreme weather events or shifts in climate patterns.  

In contrast, transition risk metrics should delve into the intricacies of scope 1-3 reporting, going beyond mere emissions reporting. This tailored approach ensures that organisations are equipped to monitor and respond to the unique challenges posed by different climate risks

In the ever-evolving landscape of corporate responsibility, the adage "you can't manage what you can't measure" holds more significance than ever, especially when it comes to climate change.  

While much attention has been rightly placed on the connection between transition risk and scope 1-3 emissions reporting, it is not sufficient. Transition risk metrics require a more comprehensive approach, encompassing factors beyond emissions.  

3. Moving Beyond Scope 1-3 Reporting: Unveiling the Nuances of Transition Risk Metrics

Recognising the clear link between emissions and carbon prices is essential, but a nuanced understanding involves exploring broader aspects of transition risks. Metrics should delve into the resilience of supply chains, the adaptability of business models, and the potential impact of policy changes. This holistic approach ensures a more robust evaluation of transition risks. 

Learn how our climate change services can empower your organisation to build resilience to the physical and transition risks of a changing climate. Contact Us Today.

4. Building a Knowledge Base through Careful Metric Selection  

Forecasting the financial risks associated with climate change is a challenging task, particularly due to the lack of business-specific impact models. However, the careful selection of reporting metrics can build the necessary evidence base. 

Organisations, especially those in the early stages of addressing climate risk, can leverage a strategic set of metrics to develop a nuanced understanding of potential financial impacts. This iterative process enables continuous learning and refinement of risk assessment models over time.

The dynamics of climate change necessitate a learning system that adapts to current events. Metrics should not be static but responsive to the evolving environmental landscape.  

5. Integrating Current Events into a Learning System: A Dynamic Approach

By linking metrics to risk assessment, organisations can create a feedback loop that incorporates real-time data and insights. This dynamic approach ensures that climate action remains relevant, effective, and aligned with the ever-changing challenges posed by climate change. 

 6. Exploring Alignment with Existing Targets: Maximising Impact through Integration  

To enhance the effectiveness of climate disclosure, organisations should explore how existing targets for other reporting align with climate disclosure metrics. By integrating climate-related metrics into broader sustainability goals, companies can maximise the impact of their actions.

This alignment fosters a more cohesive and comprehensive approach to corporate responsibility, reinforcing the interconnected nature of various environmental, social, and governance (ESG) factors. 

By embracing a tailored, dynamic, and integrated approach to metrics, businesses can navigate the challenges of climate risks while contributing meaningfully to a sustainable future. 

Guiding Climate Action Through Informed Decision-Making

Recently, the world’s leading scientific body on the effects of climate change, the Intergovernmental Panel on Climate Change (IPCC), released its sixth assessment report (AR6). We discuss a selection of key findings from the latest IPCC report that are important for those organisations wanting to take a leadership position on responding to climate change.

IPCC Assessment Report 6: Take Away Messages for Sustainability Leaders

Recent weeks have seen a community wide discussion about the dire need for emissions reduction as COP26 brought the governments of the world together to pledge to do more to address climate change. But it was only a couple of months ago that the world’s leading scientific body on the effects of climate change, the Intergovernmental Panel on Climate Change (IPCC), released its sixth assessment report (AR6). These reports are produced every 5-6 years and provide arguably the most important updates on the latest climate science. In this article, we discuss a selection of key findings from the latest IPCC report that are important for those organisations wanting to take a leadership position on responding to climate change.

Until recently, there was regular debate in the media about whether climate change was real. While on the one hand this debate has largely subsided, on the other the evidence of the change that has already occurred is rapidly increasing. The science is clearer than ever that human-induced climate change is already affecting weather and climate extremes in every inhabited region across the globe. For example, AR6 found that human activities are responsible for approximately 1.1°C of warming since 1850-1900, with warming picking up pace in recent decades. The scale of recent changes are considered to be unprecedented over centuries to thousands of years and mean that attention needs to be given to current as well as future climate when undertaking resilience planning. 

Climate model projections show that the uncertainties in atmospheric CO2 concentrations by 2100 are dominated by the differences between our anthropogenic emissions scenarios. The rate and severity of future climate change is therefore still entirely under our control. The transition to a decarbonised economy is already underway and must be accelerated if we are to avoid the worst impacts of climate change in the coming decades.

Frequency and intensity of extremes is set to increase 

Most physical climate risk is associated with extreme climate events which exceed the coping capacity of our natural, built, social and economic systems. AR6 found that extreme climatic events which are entirely unprecedented in the observational record, will occur with increasing frequency, even if we limit global warming to the now very ambitious target of +1.5°C above the pre-industrial average. Australia’s record hot, dry and charred Black Summer of 2019-20 is a clear reminder of the compound and cascading nature of future climate extremes on the horizon.   

A key driver of the increasing intensity and frequency of extremes is the intensifying water cycle. Additional heating enhances evapotranspiration from the biosphere and with every degree of warming the lower atmosphere is able to hold 7% more water vapour. This combination brings more intense rainfall and associated flooding, as well as more intense drought across many regions. 

The magnitude of feedbacks between climate change and the carbon cycle becomes larger and more uncertain in high CO2 emissions scenarios. AR6 makes it clear that additional ecosystem responses to warming are not yet fully included in climate models, such as CO2 and methane fluxes from wetlands, permafrost thaw and the giant wildfires we have witnessed around the world since 2000. These feedbacks will further increase concentrations of greenhouse gases in the atmosphere and their combined effects are not yet resolved in the models.  

Up until AR6, there has been a focus on the most likely outcomes of climate change. This is now being tempered with a balanced view across low likelihood, but very high consequence outcomes. Abrupt changes and low-likelihood, high-impact outcomes could occur at global and regional scales even for global warming within a very likely future emissions scenario. The probability of low-likelihood, high impact outcomes does increase with higher global warming levels. Abrupt responses and tipping points of the climate system cannot be ruled out and therefore need to be built into scenario development and planning exercises. 

AR6 provides the strongest evidence yet of the continuing changes being experienced in the Earth’s climate. Given the increasing focus on climate risk disclosure, especially for government agencies and large corporate entities, the results of this new modelling need to be incorporated into current and future risk assessment to provide a better understanding of the challenges we face – and where to invest in building resilience. 

AR6 reminds us that with dark impermeable surfaces our cities act to amplify many aspects of climate change. As the global population continues to rapidly urbanise, our cities become denser and we remove urban canopy cover, parks, cool green zones, floodplains and groundwater infiltration sites. These are the often-undervalued urban natural capital assets which all act to counter the effects of climate change. 

In the Australian context the most deadly impact of climate change is the increasing severity and frequency of heatwaves. The impacts of these events are further amplified by the well known urban heat island effect. Urbanisation also increases mean and heavy precipitation over and downwind of cities which results in increased runoff intensity and impacts from flash flooding. In coastal cities, the combination of more frequent extreme sea level events (due to sea level rise and storm surge) and extreme rainfall/riverflow events will make flooding much more probable. 

People can still make a positive change 

Climate model projections show that the uncertainties in atmospheric CO2 concentrations by 2100 are dominated by the differences between our anthropogenic emissions scenarios. The rate and severity of future climate change is therefore still entirely under our control. The transition to a decarbonised economy is already underway and must be accelerated if we are to avoid the worst impacts of climate change in the coming decades.  

The choice of societal responses to future climate change impacts will act to either increase or decrease community resilience to subsequent extreme events. Smart building design, holistic planning and low cost risk treatments can act together to effectively buffer our communities from climate impacts and markedly increase our resilience. Employing nature based solutions also provides us with an opportunity to sequester carbon while also protecting communities and assets from many climatic hazards. 

AR6 provides the strongest evidence yet of the continuing changes being experienced in the Earth’s climate. Given the increasing focus on climate risk disclosure, especially for government agencies and large corporate entities, the results of this new modelling need to be incorporated into current and future risk assessment to provide a better understanding of the challenges we face – and where to invest in building resilience. This is especially the case for organisations wanting to show leadership in how they assess and respond to climate change. AR6 also serves as a strong reminder of the need to rapidly decarbonise the global economy and why global gatherings such as the recent COP26 are essential for coordinated global action to reduce emissions.

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Mark’s career spans 25 years in the sustainability services sector. He has 17 years of  experience specifically in climate risk assessment and adaptation planning. His focus is on bringing together rigorous technical information and engagement processes to support improved decision making.

Mark has led award winning projects and contributed to over 100 climate change projects in the past 5 years. Mark has led and contributed to a number of urban heat mitigation and planning projects across Australia, including as the consulting director for versions 1 and 2 of the Cool Suburbs Tool for WSROC and the ACT Microclimate Assessment Tool Project.  

Mark’s career spans 25 years in the sustainability services sector. He has 17 years of  experience specifically in climate risk assessment and adaptation planning. His focus is on bringing together rigorous technical information and engagement processes to support improved decision making. 

Articles by Dr Mark Siebentritt