Evaluating Climate-Related Disclosures by New Zealand Climate Reporting Entities

This thesis evaluates climate-related disclosure practices of New Zealand Climate Reporting Entities (CREs) before and during the early implementation of Aotearoa New Zealand Climate Standards (NZ CS 1–3). New Zealand provides a valuable setting to examine how organisations respond as climate reporting transitions from voluntary to mandatory disclosure. While prior research suggests mandatory sustainability reporting influences disclosure practices, evidence on climate reporting adoption remains limited. The study assesses three dimensions of reporting practice: disclosure extent, thematic content, and readability.

Using a mixed-methods research design, the thesis constructs a disclosure corpus from 95 CREs and 667 public reports issued between 2021 and 2024. Python-based sentence-level keyword matching is used to extract climate-related narratives and measure disclosure extent across firm-years and report types. Thematic analysis is applied to 2024 disclosures using the four pillars of NZ CS 1: governance, strategy, risk management, and metrics and targets. Readability is assessed for 47 firms, predominantly listed entities, using the Coleman-Liau Index (CLI) and the Dale-Chall Readability Score (DCRS).

The results show that climate-related disclosures increased substantially following the implementation of NZ CS 1–3. The total number of extracted climate-related words increased from 100,177 in 2021 to 1,362,425 in 2024. The sharpest increase occurred in 2024, which was the first full mandatory reporting cycle captured in the sample. The thematic analysis of 2024 climate-related disclosures indicates that thematic content was not evenly distributed across the four NZ CS 1 pillars or across the 12 themes developed in this study. GHG emissions and reporting basis, climate impacts and exposure, and transition planning were the most prevalent themes, while risk response and review appeared less frequently. Readability analysis shows that mean CLI and DCRS values increased from 2021 to 2024, while median values followed a similar but more moderate pattern. As higher scores on both measures indicate greater textual difficulty, this pattern shows lower readability within the analysed sample over the study period.

The findings are interpreted through institutional and legitimacy theory. The increase in disclosure extent is consistent with the coercive pressures created by NZ CS 1–3’s mandatory reporting requirements. Normative and mimetic pressures may help explain the uneven thematic content, given differences in the availability of professional guidance and reporting precedents. Legitimacy theory further indicates that some themes offered greater value in demonstrating accountability to stakeholders. Lower readability is consistent with the technical demands of climate reporting and efforts to establish credibility during early implementation. The study contributes early evidence on mandatory climate reporting and provides a theory-based explanation for variation in thematic disclosures and readability during regulatory transition.