Scope 3 under ASRS: the One-Year Relief and What to Do Before It Ends

AASB S2 gives every Australian reporter one year before Scope 3 emissions have to be disclosed. It is the most misread line in the standard. Boards hear "relief" and move Scope 3 to next year's agenda. What the relief actually does is move the disclosure to the second reporting year while leaving the data problem exactly where it was, with the clock running. This guide explains what the relief covers, when it ends for each group, which categories are likely to be material, and how to get supplier data in before the deadline.

We first published this page in September 2025 to announce a webinar on the same subject with Beca and Microsoft. The session ran; the questions it raised are answered below.

What the relief actually says

An entity is not required to disclose Scope 3 greenhouse gas emissions in its first reporting year under AASB S2. From the second reporting year, it must disclose its Scope 3 emissions, identify which of the 15 GHG Protocol categories are included, and state the measurement approach, inputs and assumptions, including the proportion measured with primary data. Financial institutions must also disclose financed emissions under category 15.

Two other reliefs sit alongside it. Statements about Scope 3 are "protected statements" for reports covering financial years beginning between 1 January 2025 and 31 December 2027, so only ASIC can bring action over them in that window. And where information is not available without undue cost or effort, an entity may use all reasonable and supportable information available at the reporting date, which is what makes spend-based estimation permissible.

When the relief ends for each group

Group	First reporting year (30 June year end)	Scope 3 first disclosed for the year to	Scope 3 data collection must cover
Group 1	Year to 30 June 2026	30 June 2027	1 July 2026 to 30 June 2027
Group 2	Year to 30 June 2027	30 June 2028	1 July 2027 to 30 June 2028
Group 3	Year to 30 June 2028	30 June 2029	1 July 2028 to 30 June 2029

December year-ends shift by six months: Group 1 discloses Scope 3 for the year to 31 December 2026. The reporting groups guide has the thresholds for each group.

Why the relief is not a year off

The second-year figure needs a full year of activity data from suppliers, and suppliers take months to respond. A Group 1 entity with a June year end that starts supplier engagement in July 2026 has one collection cycle before the number is disclosed and assured. Anything started later is estimated, and the estimate is disclosed as such.

Year one is therefore the year to do four things: screen the categories for materiality, rank suppliers by spend inside the material categories, stand up the collection mechanism, and produce a spend-based baseline so the second-year figure has something to be compared with.

Which Scope 3 categories will be material?

AASB S2 requires the material categories, not all fifteen. For most Australian companies the tonnes sit in a few:

• Category 1, purchased goods and services: the largest category for almost every manufacturer, retailer and service business.
• Category 2, capital goods: material in a year with a large build or fleet purchase.
• Category 3, fuel-and-energy-related activities: upstream emissions of the fuel and electricity already in Scope 1 and 2.
• Category 4, upstream transport and category 9, downstream transport: material for anything physical that moves.
• Category 11, use of sold products: dominant for equipment, vehicle and appliance makers.
• Category 15, investments: financed emissions for banks, insurers and asset managers, with the metrics AASB S2 specifies.

A materiality screen costs a few days and directs the whole programme. Skipping it means chasing every supplier for every category and getting none of them back in time.

How to collect supplier data without drowning in it

Email does not scale past about twenty suppliers. What works:

1. Rank suppliers by spend inside each material category. The top tier that covers most of the emissions is usually a few dozen names.
2. Send a short, pre-filled request through a portal, not a spreadsheet. The ESG Supplier and Customer Portal asks each supplier only for what applies to them, chases automatically and validates what comes back.
3. Extract what suppliers already send you. Invoices, delivery notes and certificates carry activity data. The Scope 3 Hub reads them with AI and turns them into factor-ready figures, with a person checking the extraction.
4. Keep spend-based estimates for the tail, flagged by data quality, and replace them category by category as primary data arrives.
5. Record the method and the proportion of primary data against every figure as it lands. AASB S2 requires both to be disclosed, and the assurer will ask for both.

What we showed in the webinar

In September 2025 we ran a session with Beca's sustainability and climate team and Microsoft on exactly this problem. Beca described its path through Scope 3 and voluntary climate disclosure ahead of the mandatory regime. We demonstrated Scope 3 collection in Microsoft Sustainability Manager, including the supplier portal and AI extraction from supplier documents. The recording is available on request through the contact form.

Frequently asked questions

What does the Scope 3 relief actually say?

An entity is not required to disclose Scope 3 greenhouse gas emissions in its first reporting year under AASB S2. From the second year, material Scope 3 categories must be disclosed with the measurement approach and inputs stated.

When does the relief end for us?

In your second reporting year. For a 30 June year-end: Group 1 discloses Scope 3 for the year to 30 June 2027, Group 2 for the year to 30 June 2028, Group 3 for the year to 30 June 2029. December year-ends are six months earlier for Group 1 and six months later for Groups 2 and 3.

Can we use spend-based estimates in year two?

Yes, where primary data is not yet available, provided the method and its limits are disclosed. Assurance and credibility improve as spend-based figures are replaced with supplier-specific or activity data, so the year-one job is to start that replacement on the material categories.

Which Scope 3 categories will be material?

It depends on the business, but for most Australian companies purchased goods and services, capital goods, fuel-and-energy-related activities and use of sold products account for most of the tonnes. Financial institutions must also cover financed emissions in category 15.

Do we have to ask every supplier?

No. Screen the 15 categories for materiality, rank suppliers by spend within the material categories, and collect primary data from the top tier that covers most of the emissions. Spend-based estimates cover the tail.

This guide summarises AASB S2 as at September 2026. Check the current standard or take advice for your own circumstances.