Clarity for Certainty: Advancing Corporate Policy Engagement Transparency in Australia

Roman Davas-Fahey, Global Voices, COP29 2024 Fellow

Executive Summary

In Australia, many leading companies publicly endorse climate action; yet their policy engagements are frequently misaligned with the Paris Agreement - undermining their pro-climate commitments (InfluenceMap, 2021, 2024a). Despite the Australian Government’s recognition of the critical role investors play in funding the country's transition to net zero, investors have limited insight into the corporate policy engagement (CPE) activities of Australian companies. This is largely due to the absence of strong lobbying transparency laws and inadequate voluntary disclosures by companies (InfluenceMap, n.d.; Ng, 2020; The Senate, Finance and Public Administration References Committee, 2024).

A lack of transparency on corporate engagement in public policy presents significant risks to investors and undermines Australia’s pathway to net zero. This paper explores the risks associated with undisclosed CPE activities and their impact on investors, with a specific focus on climate lobbying. It highlights how poor transparency of CPE activities creates policy uncertainty, delays regulatory action, and weakens investment signals. 

Drawing on international frameworks – most notably the European Sustainability Reporting Standard (ESRS) requirements for political engagement disclosures – this paper recommends amending the Corporations Act 2001 (Cth) to mandate Australia's current voluntary Sustainability Reporting Standards (ASRS SSB1) and expanding them to include corporate policy engagement. Such a policy would position Australia as a leader in corporate accountability and governance, ensuring companies provide detailed and consistent information on their lobbying activities, political contributions, and the alignment between their public commitments and policy engagements. Two main risks emerge: industry pushback against the additional reporting costs, and limited political appetite for mandating disclosures of corporate policy-engagement activities.

Problem Identification: Corporate Policy Engagement is Material to Investors

Corporate policy engagement (CPE) encompasses a wide range of corporate activities aimed at influencing government policy and public discourse, including lobbying, public campaigns, research sponsorship and political financing (Bombardini & Trebbi, 2025; Mialon et al., 2016; OECD, 2022; UNEP et al., 2013). 

Corporate engagement in public policy is increasingly recognised as an investment risk, where CPE activities create firm and industry-level risks and amplify systems-level risks (OECD, 2022; PRI, 2022). CPE activities contribute to policy uncertainty by obstructing critical climate policies, delaying regulatory action, and the investment signals needed for the energy transition (Australasian Centre for Corporate Responsibility (ACCR), 2023; InfluenceMap, 2024a). This increases financial risk for investors, who seek stable and predictable policy environments to guide capital allocation (Investor Group on Climate Change (IGCC), 2025). For example, a survey by IGCC of investors representing $37 trillion of Australia’s institutional capital market found 40% of investors cited policy and regulatory uncertainty as a major barrier to investment (IGCC, 2024a). 

There is increasing investor demand for greater CPE transparency on material issues, particularly climate change (Climate Action 100+, 2024a; Newton, 2024). A key example is Climate Action 100+, the largest-ever global investor engagement initiative on climate change, which now comprises 700 investors responsible for over $68 trillion in assets under management (Climate Action 100+, 2024a). The initiative specifically prioritises policy engagement disclosure and alignment in its benchmark assessment. Investors are also becoming increasingly vocal about corporate lobbying practices and strengthened oversight of CPE at annual general meetings (Climate Action 100+, 2024b; Interfaith Center on Corporate Responsibility, 2025). Data from S&P Global highlights that resolutions related to climate change and corporate lobbying outpaced other shareholder concerns in 2024 (Rives, 2024). While this proposal focuses on CPE related to climate change, the rationale for enhanced disclosure requirements is equally relevant to other areas of public policy influence, such as on nature and health (WMBC, 2023).

The Australian Government recognises the critical role that investors play in funding Australia’s transition to net zero and the need for rigorous, internationally aligned and credible disclosures (Australian Government, Department of Treasury, 2024a). Achieving Paris Agreement-aligned targets in Australia will require $420 billion to decarbonise the National Electricity Market (Clean Energy Investor Group & Baringa, 2022; IGCC, 2024b). Yet, investor insight into the CPE activities of Australian companies remains limited, largely due to the absence of strong lobbying transparency laws and inadequate voluntary disclosures by companies (InfluenceMap, n.d.; Ng, 2020; The Senate, Finance and Public Administration References Committee., 2024).

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The views and opinions expressed by Global Voices Fellows do not necessarily reflect those of the organisation or its staff.