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ASX-listed companies aren’t doing enough to tell investors about the threat of climate change to their businesses, the corporate watchdog says.

The regulator, ASIC, reviewed 60 ASX300 companies and 25 IPO prospectuses and says of those which mentioned the issue at all, most were too general to be useful for investors.

It didn’t name the companies it looked at.

Only 10 of the listed companies in the review explicitly identified climate change or climate risk as a material business risk, but the majority considered it in some way.

In the review of IPO prospectuses ASIC found few mentions of climate risk, and ASIC says very few companies outside the ASX200 were making any kind of climate risk disclosure.

The vast majority of listing companies on the ASX are small and micro caps.

“One of the prospectuses reviewed cited transition climate risk as a key risk, highlighting public concern around the issue of climate change and the possible impact of regulatory responses as a risk to the relevant company’s business model,” the Climate risk disclosure by Australia’s listed companies report said.

“However, in the majority of prospectuses reviewed, while both environmental and regulatory risks were generally cited as risks to the business model of the relevant company, there was insufficient detail disclosed to enable an investor to determine if climate risk formed part of those broader risk categories, and, if so, how and to what extent.”

A number of the prospectuses described business models that were connected to the transition to a low-carbon economy, such as renewable energy companies.

But ASIC said even they didn’t consider climate risk to the business.

Section 710 of the Corporations Act requires a prospectus to include any information investors may need to assess the company.

Disclosing climate risk is not a specifically mandated rule by the ASX or ASIC, but it’s becoming a rising issue — CBA endured a class action last year over its lack of climate risk disclosure — and both are looking at the issue.

The ASX does not have official guidelines on climate risk disclosure yet.

But a consultation draft on its Corporate Governance Principles and Recommendations last year identified “carbon risk” and climate change as a material issue companies should report on an “if not, why not” basis — that is if they’re not going to report they should explain why.

These included the risk of assets being destroyed and business operations being disrupted by extreme weather events or long term shifts in climate patterns; changes in government policy; the need to adopt new technologies to mitigate the effects of climate change; and liability risks.