Across hundreds of conversations we’ve had at Avarni with CFOs and finance leaders in leading Australian organisations, a consistent shift is emerging. Carbon reporting is increasingly embedded within finance, governance and operational decision-making rather than managed solely within sustainability functions.
This change reflects more than regulatory reform. It represents a structural evolution in how organisations design, control and use emissions data. As AASB S2 takes effect and assurance expectations increase, reporting frameworks are being rebuilt with stronger financial discipline.
This article examines how that maturity is unfolding across Australian organisations and what distinguishes those progressing most effectively.
Carbon reporting is moving into finance
In earlier stages, carbon reporting was often led by sustainability or ESG teams, with limited integration into financial controls. Scope 1 and Scope 2 emissions were calculated using spreadsheets, and Scope 3 was frequently treated as an external or consultant-driven exercise.
As disclosure requirements formalise, finance teams are assuming greater ownership. Emissions data is now being subjected to documented methodologies, reconciliations to source systems and structured review processes. The emphasis has shifted toward internal controls, audit trails and clearly defined accountability.
Organisations that are progressing well are aligning carbon accounting with existing financial governance frameworks. They are reconciling activity data to audited financial records, documenting assumptions early and ensuring emissions reporting follows the same discipline applied to statutory disclosures.
Organisational and operational boundaries are being formalised
Boundary definition is another clear indicator of maturity. Rather than relying on informal interpretations of operational control, organisations are conducting structured assessments aligned with consolidation principles.
In multi-entity groups, this involves clarifying control relationships, shared service arrangements and reporting entity definitions. Decisions about inclusion are being documented carefully to preserve consistency across reporting periods and avoid restatements.
Scope 3 boundaries are also receiving earlier attention. Organisations are mapping all relevant categories under the GHG Protocol, even where detailed disclosure may be phased in. This forward planning reduces future rework and supports comparability year on year.
Formal boundary setting creates a stable reporting perimeter that underpins reliable data collection and disclosure.
Methodology discipline is increasing
As assurance requirements tighten, methodological clarity has become central.
Finance leaders are asking detailed questions about emission factor selection, geographic relevance, data year alignment and currency treatment. Organisations are documenting their choice of databases, such as the National Greenhouse Accounts Factors, EPA, DEFRA or EXIOBASE, based on data availability and reporting needs.
Changes in methodology are being recorded transparently, and factor updates are applied in a controlled manner to preserve trend integrity. This level of documentation supports both audit defensibility and internal confidence in reported outcomes.
The result is a shift away from one-off calculations toward structured, repeatable methodologies embedded within reporting cycles.
Scope 3 is being treated as a multi-year program
Scope 3 remains the most complex element of carbon reporting, and maturity is most visible in how organisations are approaching it.
Rather than attempting to solve all data gaps in a single reporting cycle, leading organisations are establishing structured roadmaps. They begin with spend-based baselines to achieve completeness across purchased goods and services, often grounded in the general ledger. Material categories are then prioritised for refinement through activity-based data or supplier engagement.
This staged progression reflects a clear understanding of data hierarchy under the GHG Protocol. Completeness is established first, followed by targeted improvements in accuracy and granularity.
By treating Scope 3 as an ongoing program rather than a discrete project, organisations preserve methodological stability while improving data quality over time.
Emissions data is informing capital and operational decisions
Maturity is also evident in how emissions data is being used beyond disclosure.
In asset-intensive sectors, emissions metrics are being incorporated into capital expenditure evaluations, electrification strategies, fuel switching decisions and asset upgrade planning. In property and infrastructure businesses, embodied carbon considerations are entering project design discussions earlier.
Procurement functions are increasingly involved in Scope 3 refinement, particularly where supplier emissions represent material exposure. This integration strengthens alignment between sustainability objectives and commercial decision-making.
As emissions data becomes more reliable and controlled, it supports strategic decision-making rather than existing solely as a reporting output.
Internal capability is scaling
As carbon reporting becomes embedded within finance, resourcing models are evolving. Many organisations initially relied on a single individual managing emissions reporting alongside broader sustainability responsibilities. That model is proving insufficient under assurance and expanded Scope 3 requirements.
Finance teams are developing clearer ownership structures, building internal technical capability and engaging external advisors strategically where needed. The objective is to establish reporting infrastructure that can scale with regulatory change.
Forward planning is becoming a defining characteristic of more mature organisations. Rather than responding reactively to each new disclosure requirement, they are building frameworks designed to accommodate increasing complexity.
A defining shift in governance
The most significant change across the organisations we speak with is governance alignment. Carbon reporting is now treated as structured reporting infrastructure within finance, supported by documented controls and executive oversight.
Organisations that embed carbon accounting within financial governance frameworks, formalise boundaries, document methodologies and build scalable systems are positioning themselves strongly for future disclosure cycles.
As regulatory expectations continue to evolve in Australia, transparency, consistency and auditability are becoming baseline requirements. Those that invest early in disciplined reporting structures are experiencing smoother assurance processes and greater board confidence.
Summary
- Across conversations at Avarni with Australian CFOs, carbon reporting is increasingly embedded within finance and governance structures.
- Organisational and Scope 3 boundaries are being formally assessed and documented to preserve consistency.
- Methodology discipline, including emission factor selection and documentation, is strengthening under assurance expectations.
- Scope 3 is being approached as a staged, multi-year program grounded in completeness and progressive refinement.
- Emissions data is increasingly influencing capital allocation, procurement and operational strategy.
- Internal capability and governance structures are scaling to support long-term reporting infrastructure.
