This study provides the first empirical evaluation of comprehensive mandatory climate disclosure, focusing on New Zealand’s world-first TCFD/ISSB-aligned regime. We assess its effectiveness using a survey exploring reporting motivations/challenges, a novel Large Language Model (LLM)-based tool quantifying disclosure compliance, and analyzing reporting trends before and after the mandate. We also compare changes in fund manager capital allocation between mandated and non-mandated entities. Findings reveal the mandate significantly increased reporting quantity and quality, particularly for corporate issuers, improving alignment with Aotearoa New Zealand Climate Standards. Mandated fund managers demonstrated improved portfolio
ESG performance and decreased Carbon Intensities versus non-mandated peers post-mandate. While challenges like data reliability and resource constraints persist, especially for complex metrics, the results show that the mandate effectively enhances transparency and influences capital allocation towards sustainability. This offers crucial early evidence supporting similar global regulatory efforts.
