The Forward - Issue 08: Rio Tinto

Mining & Resources · Annual Report (ASRS Climate Disclosures)

Last week we annotated Arafura Rare Earths, a junior whose sustainability report helped underwrite a $1.6 billion final investment decision. This week we turn to the other end of the scale: Rio Tinto, whose 2025 Annual Report carries the company's first climate disclosures prepared as a mandatory filing under the new Australian Sustainability Reporting Standards (ASRS). It is one of the most detailed climate statements an Australian miner has ever published.

The timing matters because on 18 May 2026, ASIC released its early observations on the first wave of mandatory sustainability reports, a signal to every 30 June reporter about the disclosure quality the regulator now expects. Rio's report clears that bar comfortably. It is transparent about its gross and net emissions, candid about where progress is slow, and open about the parts of its footprint it cannot yet address. And that is the uncomfortable finding of this issue: the better the disclosure gets, the clearer it becomes how far the underlying decarbonisation has to go.

Published 19 February 2026 · Covers year ended 31 December 2025 · 348 pages (climate disclosures pages 46-86).

Mandatory ASRS climate disclosure under Chapter 2M of the Corporations Act, complying with AASB S2 Climate-related Disclosures. Also aligned to TCFD, the UK CFD Regulations 2022, the Transition Plan Taskforce framework and the CA100+ Net Zero Company Benchmark. Directors' declaration on the climate statement signed 19 February 2026.

Mining & Resources ASRS Group 1 Disclosed

Annotated with plain-English context and our take on what it means for you.

Passage 01 — The Strongest Lever

"Following the PPAs [power purchase agreements] announced in 2024, we have contracted a total of 2.7 GW of renewable generation and 540 MW of battery storage... the contracted projects could supply approximately 80% of BSL's [Boyne Smelter’s] annual average electricity demand, enabling a projected 70% reduction in BSL's Scope 1 and 2 emissions."

Rio Tinto, Annual Report 2025, p.56

Our Take

Repowering the Boyne and Tomago smelters is Rio's single largest lever to 2030, the two assets together account for around a quarter of its emissions, and Rio has now contracted 2.7 GW of renewable generation and 540 MW of storage towards Boyne. That is real, structural, asset-level abatement, not an accounting adjustment, and the disclosure is specific about the projected outcome: roughly 80% of Boyne's electricity demand and a 70% cut in the smelter's Scope 1 and 2 emissions. Rio is also straight about the catch. The contracted projects are still at final-investment-decision stage, and securing Boyne's future "still requires support from state and federal governments." Strong progress, honestly hedged. The question the rest of the report answers is how much of the 2030 target rides on this one pathway landing on time.

💡 Plain English: Rio's biggest emissions lever is real and progressing: 2.7 GW of renewables contracted to repower its largest smelters.

Passage 02 — The Paused Pilot

"The BioIron™ pilot plant work, and associated commissioning target, has been paused due to technical and design challenges often associated with early-stage innovation. We remain committed to the long-term potential of BioIron™ technology."

Rio Tinto, Annual Report 2025, p.69

Our Take

BioIron is Rio's signature contribution to low-emissions steelmaking, the technology meant to show how the world's largest iron ore producer helps decarbonise its highest-emitting product. Rio spent $65 million on steel decarbonisation in 2025, and the report frames the pathway with confidence. On the same pages, it discloses that the pilot plant, the step that turns the idea into evidence, has been paused. Rio handles this honestly, naming the technical and design challenges rather than burying them. The value of reading the disclosure closely is that the commitment language and the pause sit side by side.

💡Plain English: The flagship green-steel pilot is on hold, disclosed plainly on the same pages that affirm commitment to it.

Passage 03 — The 95% With No Target

"We have not set an overall Scope 3 emissions target due to the limited direct influence we have on the decarbonisation activities of our customers, required maturation of technology adoption and grid decarbonisation in customers' host countries."

Rio Tinto, Annual Report 2025, p.62

Our Take

Rio's 2025 Scope 3 emissions were 575.7 Mt CO2e, roughly 18 times its Scope 1 and 2 combined, and up on the prior year. The report is unusually frank about this: it states the figure, attributes 95% of it to customers processing iron ore, bauxite and alumina, and explains plainly that no overall reduction target has been set. The candour is real, and it is exactly what makes the gap visible. The disclosure that the company is most transparent about is the one covering almost its entire climate footprint, and it is the one with no target attached. Rio points instead to customer-country net-zero trajectories landing "around 2060." This is the disclosure-versus-practice gap at its widest: world-class reporting on the 95% of emissions that no current commitment is designed to reduce.

💡 Plain English: The 95% of Rio's footprint that sits with customers is disclosed in full but carries no reduction target.

Scope 1, 2 & 3 Emissions:

Scope 1 is direct emissions from Rio's own operations (smelters, mines, vehicles); Scope 2 is emissions from the electricity it buys; Scope 3 is emissions from others using Rio's products, chiefly customers turning its iron ore into steel and its bauxite into aluminium. For Rio, Scope 3 (575.7 Mt CO2e) dwarfs Scope 1 and 2 (31.5 Mt) by around 18 times.

ASRS (Australian Sustainability Reporting Standards):

Australia's mandatory climate disclosure regime under Chapter 2M of the Corporations Act, phased in from January 2025. AASB S2 is the climate standard within it.

Australian Accounting Standards Board (AASB S2):

The Australian climate disclosure standard, equivalent to the international IFRS S2. It governs how companies report climate risks, targets and emissions in a mandatory sustainability report.

Gross vs net emissions:

Gross emissions are what an operation actually emits. Net emissions subtract offsets such as carbon credits. The gap between Rio's 14% gross reduction and 17% net reduction is the offset contribution.

ACCU (Australian Carbon Credit Unit):

A tradeable unit representing one tonne of CO2e avoided or removed, used to meet Safeguard Mechanism obligations. Rio retired about 1.01 million for its 2024 compliance.

⛏️ This month at CFS - ASRS and madatory climate disclosure preparation

The first wave of mandatory reports has shown what the regulator expects, and where the hard questions land: assumptions, target-setting, and the distance between a compliant disclosure and an operational plan. CFS helps mining and energy companies prepare ASRS-ready climate disclosures that hold up to scrutiny and connect to real decarbonisation pathways. To talk it through, get in touch by emailing Bronwyn directly.

CFS Cantilever Future Solutions

ESG & sustainability advisory · Mining & Energy

Perth, Western Australia

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