China has formally introduced its first national corporate climate reporting standard, marking a pivotal step in advancing climate-related disclosure and sustainability transparency across its corporate sector. The Ministry of Finance, in collaboration with several government bodies, including the central bank and other regulators, unveiled the “Corporate Sustainable Disclosure Standard No. 1 – Climate (Trial),” a framework aligned with the International Financial Reporting Standards (IFRS) Foundation’s climate reporting standard. The new standard is designed to enable companies to disclose climate-related risks, opportunities, and impacts, promoting transparent, comparable, and reliable reporting practices that support China’s broader green development objectives.
Initially positioned as a voluntary pilot, Chinese authorities intend to expand the standard’s application over time, ultimately moving toward mandatory climate disclosures for a broader range of entities. Officials have indicated that the phased rollout will begin with key sectors and listed companies before extending the requirements to non-listed firms and small to medium-sized enterprises, as well as shifting from qualitative to more quantitative reporting metrics. The standard’s adoption of an IFRS-aligned disclosure structure, including governance, strategy, risk and opportunity management, and metrics and targets, signals China’s intent to harmonize corporate climate reporting with global best practices while tailoring the approach to domestic regulatory and economic conditions.