Submission: Opposing the Financial Markets Conduct Amendment Bill

(Amendment Paper No. 446 — Scott Simpson)

From: Ukes Baha | 4 December 2025

Submitted in response to the Committee’s call for submissions on the Bill.

1. Introduction

I oppose Amendment Paper No. 446 in full. The proposed changes dismantle core accountability mechanisms within the climate-related disclosure regime and create new pathways for corruption, unmanaged environmental harm, and weakened oversight of high-risk industries.

This Amendment Paper does not “simplify” or “streamline” the law. It removes protections, transparency, and evidence requirements in a way that directly benefits industries whose activities carry the greatest environmental and financial risk — including large-scale mining, extraction, heavy industry, and pollution-intensive operations.

The public interest, investor confidence, Māori interests, ecological integrity, and long-term national resilience are all significantly harmed by these amendments.

2. Summary of Concerns

The Amendment Paper:

Legalises unsubstantiated climate statements (new s 26A).
Removes entire classes of entities from climate reporting obligations (clauses 28A–28Q).
Raises reporting thresholds from $60 million to $1 billion, eliminating most listed issuers (clause 28B).
Removes director liability for defective climate reporting (clause 29B).
Removes assurance requirements and verification pathways (clauses 28M–28O).
Establishes transitional provisions allowing entities to immediately stop climate reporting (Schedule 1, clause 108).
Provides broad regulatory discretion to further raise thresholds through secondary legislation (new s 547).

These changes are not neutral. They materially weaken the integrity of New Zealand’s financial-markets framework.

3. New Section 26A: Legalising Unsubstantiated Representations

New section 26A explicitly states that the prohibition against unsubstantiated representations does not apply to climate statements.

This is extraordinary and unprecedented.

It means:

climate disclosures no longer require evidence,
entities may publish unverified or speculative information,
accountability under the Fair Trading Act is removed, and
investors and the public lose the right to expect truthful, substantiated reports.

Creating a carve-out that legalises unsubstantiated climate reporting is not “efficiency”. It is a structural invitation to misinformation and concealment.

4. Deregulation That Enables High-Pollution Activities

By removing reporting obligations, lifting thresholds, and eliminating verification, the Amendment Paper significantly reduces scrutiny over industries with large environmental footprints.

The timing and nature of these changes align with the Government’s stated emphasis on:

mining expansion,
mineral extraction,
energy exploration,
“fast-tracked” industrial activity, and
easing environmental constraints to accelerate commercial projects.

A weakened climate-reporting regime ensures these industries can operate without disclosing:

long-term environmental liabilities,
pollution risk,
water and land degradation,
emissions exposure, or
ecological harm.

Such concealment exposes the public to severe future costs — economic, ecological, and social.

5. Removal of Director Liability (Clause 29B)

Clause 29B removes provisions that formerly held directors accountable for defective climate disclosures.

Without director liability:

accountability disappears,
governance integrity declines,
incentives to comply are removed, and
misconduct becomes easier to conceal.

New Zealand has already seen examples where lack of director accountability led to systemic harm. Repeating that pattern within climate-related disclosures increases systemic risk in financial markets.

6. Raising Reporting Thresholds to $1 Billion (Clause 28B)

The increase from $60 million to $1 billion removes most listed issuers from climate-reporting obligations.

This drastic de-scoping:

excludes nearly all medium-sized companies,
shields large polluters structured below the billion-dollar threshold,
transfers risk to investors who no longer have visibility, and
places New Zealand out of alignment with comparable jurisdictions.

This elevation of thresholds has no public-interest justification.

7. Removal of Verification Requirements (Clauses 28M–28O)

The Amendment Paper removes the obligation for independent assurance of greenhouse-gas disclosures.

Without verification:

entities can publish inaccurate or misleading emissions data,
there is no independent check on environmental integrity,
investors cannot rely on the information provided, and
regulators are left without enforceable evidence.

This undermines the basic function of disclosure systems.

8. Transitional Clauses Enabling Immediate Non-Reporting

Schedule 1, clause 108(1)(a) allows entities to instantly cease preparing or lodging climate statements, even for periods already underway.

This abrupt removal:

creates major gaps in the disclosure record,
undermines long-term analysis,
disrupts investor expectations, and
impairs regulatory continuity.

Such retroactive loosening is poor legislative practice and should not be accepted.

9. Corruption Risk and the Abuse of Power

Weakening climate-related disclosure at precisely the moment that large-scale mining and extraction initiatives are being advanced is not coincidental.

Unchecked extraction industries have a long global history of:

pollution,
community harm,
regulatory capture,
environmental degradation, and
political influence.

A disclosure framework that permits:

unsubstantiated claims,
no verification,
no director accountability, and
large-scale exemptions

is a framework that invites corruption.

New Zealand’s financial markets rely on transparency, evidence-based reporting, and strong oversight. This Amendment Paper dismantles those foundations. A regulatory regime that permits concealment is not neutral — it is dangerous.

10. Te Tiriti o Waitangi and Environmental Guardianship

Extractive industries disproportionately impact Māori land, waterways, ecosystems, and cultural relationships with whenua.

Weakened disclosure obligations:

reduce accountability to iwi and hapū,
obscure environmental harms that affect Māori communities,
undermine partnership principles under Te Tiriti.

A meaningful climate-related disclosure system is essential for upholding the Crown’s environmental stewardship obligations.

11. Recommendations

I recommend that the Committee:

Reject Amendment Paper No. 446 in full.
Retain the prohibition on unsubstantiated representations for climate disclosures.
Maintain director liability for defective climate reporting.
Preserve independent assurance requirements.
Retain thresholds at current levels rather than lifting them to $1 billion.
Ensure all entities currently reporting continue to do so, including during transitional periods.
Introduce explicit corruption-prevention clauses for high-risk extraction industries.

These recommendations protect:

investors,
communities,
ecosystems,
financial markets,
and the integrity of public governance.

12. Conclusion

Amendment Paper No. 446 weakens New Zealand’s financial-markets transparency at a time when strong oversight is essential.

It removes evidence requirements, dismantles verification systems, and opens the door to unmonitored pollution and harmful extraction activities.

A healthy economy relies on truthful reporting. A healthy democracy relies on transparency. A healthy environment relies on accountability.

This Amendment Paper undermines all three. For these reasons, I urge the Committee to reject it.

Respectfully submitted,
Ukes Baha
Public Health Advocate | Counsellor | Policy Analyst
ukesbaha.com